The influences of prior austenitization treatment and state of applied stresses on the evolution of transformation plasticity (TP) strains during isothermal bainitic phase transformation and the resulting microstructures were examined. The key finding is that, upon pre-straining, the amount of TP strain under superimposed elastic stresses is dictated by both the prior austenite grain size (AGS) and the (0.01% offset) yield strength of the supercooled austenite. Furthermore, the superimposition of internal stresses present due to pre-straining and externally applied stresses results in TP strains similar to those obtained when a permanent stress equivalent to the 0.01% offset yield strength of the supercooled austenite is applied. Another important result is that lower TP strains were observed when decreasing the AGS, which is accompanied by an increase in grain boundary area per volume, hindering the growth of preferred variants. Overall, the results clearly lay out the influence of AGS and the particular 0.01% offset yield strength of the supercooled austenite in limiting the TP strains, which has to be incorporated into current models involving bainitic phase transformations.