The paper concerns possibility of increasing yield and ultimate stress of austenitic stainless steels by equal channel angular pressing (ECAP). To this end, an AISI 304 stainless steel subjected to eight passes of ECAP in a 105◦ die at 350◦ C. The evolution of microstructure as a function of induced plastic strain (number of passes) was studied in different length scales using light and scanning transmission electron microscope (STEM). An insight into fine details of dislocation structure was possible via X-ray diffraction profile analysis. Changes in the structure of processed samples were correlated with their mechanical properties as determined by tension tests and microhardness measurements. Light microscopy revealed a shear banded microstructure. STEM observations demonstrated co-existence of three types of grain structure: (a) short elongated grains/subgrains of 71 nm average width formed within the shear band regions, (b) a mixture of coarse (200–350 nm in size) and nanocrystalline (15– 70 nm) equiaxed grains developed outside the shear bands, and (c) nano-twin lamellae of 3–20 nm width inside nanocrystalline grains. XRD peak profile analysis using modified Warren–Averbach approach yielded dislocation density as ρ = 4.71 × 1015 m−2 after eight passes. ECAP-induced changes in the microstructure led to a remarkable increase in yield strength of the alloy (YS=1498 MPa, about 3.5 times the initial amount). At the same time, a moderate ductility of εf = 12% was maintained, primarily due to a large post-necking elongation. This behavior was explained by an increase in the strain rate sensitivity of ECAP-ed material in combination with the contribution from transformation induced plasticity, TRIP effect, caused by formation of ∼ 22 vol% martensite during room temperature straining.