We are entering an era of re-electrification, seeking high-power density electrical machines with minimal resource use. Significant performance gains in electrical machines have been achieved through precise manufacturing processes, including the shaping/cutting of soft magnetic materials. However, most studies have evaluated magnetic performance at a macro level, focusing on components, while the fundamental mechanisms, e.g., how the micromagnetic behaviour is affected by mechanical interference, remain unclear. In this study, we examine the impact of sub-micron deformations at opposing strain rates (10−2 to 101 s−1) on the micromagnetic behaviour of soft magnetic non-oriented electrical steel. Using a diamond probe to indent within a single grain of polycrystalline material at different velocities, we induce quasi-static and dynamic mechanical loading. Our analysis, employing magnetic force microscopy, transmission Kikuchi diffraction, and scanning transmission electron microscopy with a pixelated detector, reveals that magnetic texture disturbances rely on the time-dependent dislocation dynamics of the Fe-BCC material. Additionally, we compress micro-pillars to further investigate these effects under bulk-isolated deformation. These findings highlight the importance of considering even ultra-small loads, such as nano-indentations and micro-pillar compressions, in the manufacturing of next-generation electric machines, as they can affect magnetic texture and performance.