A 316L stainless steel was processed by high-pressure torsion (HPT) to evaluate the grain refinement and phase transformation. The initial material was essentially a single phase γ-austenite with a coarse-grained microstructure of ∼42µm but the grain size was reduced to ∼45nm after 10 turns of HPT. In addition, there was a phase transformation and the initial γ-austenite transformed initially to ε-martensite and finally to α′-martensite with increasing strain. The dislocation density increased to an exceptionally high value, of the order of ∼1016m−2, in the main α′-martensite phase after 10 HPT revolutions. The formation of the multiphase nanocrystalline microstructure yielded a four-fold increase in hardness to reach an ultimate value of ∼6000MPa. The Hall–Petch behaviour of the HPT-processed alloy is compared directly with coarse-grained materials.