A comprehensive multimodal measurement environment integrating X-ray computed tomography (CT) and special X-ray diffraction (XRD) using a collimated beam has been developed and was applied for the first time to investigate martensitic transformation and damage behaviour in transformation-induced plasticity (TRIP) steels. The transformation and damage behaviour of numerous γ grains were analysed individually to understand the behaviours and to identify the factors controlling these processes.A transition was observed from a stress-assisted transformation in the early loading phase, controlled by mechanical driving forces, to a strain-induced transformation controlled by dislocation density. A characteristic reversal in the transformation rate was observed whereby γ grains with a crystallographic orientation that initially undergo rapid transformation due to high mechanical driving force underwent a sudden deceleration of transformation. Conversely, γ grains with an orientation that initially underwent gradual transformation rapidly completed transformation. The preceding hard phase inhibited the transformation of neighbouring γ grains through the triple effects of reducing stress triaxiality, relaxing stresses and constraining plastic deformation.The growth of pre-existing voids was modest, and material damage was dominated by voids that were newly formed during deformation from α′ grains. The initiation and progress of damage were influenced by the combined effects of the γ grain morphology and their interaction with surrounding α′ grains. The complexity of the local morphology governed the martensitic transformation and damage behaviour, and geometrical parameters were identified as highly sensitive indicators for describing this phenomenon. Finally, industrial measures to design damage-resistant TRIP steels based on these research findings are discussed.