A systematic investigation regarding the effect of stress on the stability and diffusion behavior of S impurity in Ni was carried out via first-principles methods. A comparison of the formation energy of S in Ni indicated that S more easily forms as a solution atom with increasing S concentration in Ni supercells, but the binding energy showed that as the concentration of S that dissolved into Ni increased, the structure became less stable. The diffusion barrier via the octahedral–tetrahedral–octahedral site path was always lower than that via the octahedral–octahedral site path. The diffusion barrier of single S decreased with increase in tensile stress. S diffusion accelerated under applied tensile stress, which was disadvantageous in suppressing S retention in Ni. These results implied that even at a low concentration, dissolved S still had a tendency of precipitating from the Ni matrix, to further increase the stability of the system.