This study explores the high-temperature oxidation behavior of AISI 321 austenitic stainless steel (ASS) at 600 °C in an Ar-21vol.%O2 atmosphere, considering nanometer-sized surface grain size and pre-oxidation conditions. After initial solution annealing at 1050 °C, AISI 321 ASS samples were water-quenched for homogenized microstructure (SAed samples). Moreover, the surface nanocrystallization of AISI 321 ASS was performed through high-energy shot peening (SNCed samples), reducing the surface grain size to ~75 ± 5 nm. Pre-oxidation occurred at 400 °C for 150 h in Ar-21%O2 for both SAed and SNCed samples. High-temperature oxidation kinetics was analyzed at 600 °C for 150 h using thermal gravimetric analysis (TGA) on pre-oxidized and non-preoxidized SAed and SNCed samples. FESEM/GDOES and GI-XRD revealed that SNCed samples exhibited improved oxidation resistance, showing no Cr depletion in the subsurface oxide layer up to 100 h, and only minor signs after 150 h. Pre-oxidized SNCed samples demonstrated superior oxidation performance, showing no Cr depletion and subsurface Kirkendall pore formation even after 150 h. These findings are coupled with diffusion relationships, and propose potential mechanisms for enhancing the oxidation behavior of pre-oxidized SNCed AISI 321 stainless steel.