Nitrogen ion implantation can be used to improve the surface mechanical properties of austenitic stainless steel. In this study, austenitic stainless steel was irradiated with 1.1 MeV N ions at room temperature up to 15 displacements per atom. Then the microstructural and mechanical properties were studied by grazing incidence X-ray diffraction and nano-indenter. A finer synchrotron radiation diffraction pattern is obtained compared with traditional X-ray diffraction, indicating an expanded austenite phase γN and CrN phase after being irradiated to several damage levels. An irradiation-induced martensite phase appears first and then disappears with increased damage. The enrichment of the nitrogen supply in austenitic stainless steel can explain this phenomenon. The hardness data show an irradiation hardening phenomenon. Two different inflexion points hc1 and hc2 in H2 versus 1/h curves are observed, and the real hardness of the irradiation damaged layer can be obtained from the H2 versus 1/h curve between hc1 and hc2.