Dissimilar joints of AISI 430 ferritic and AISI 304L austenitic stainless steels were produced by friction stir welding process. A sound and defect-free joint was obtained at 1 mm tool offset towards the ferritic sample located in the advancing side, and at rotational and welding speeds of 560 rpm and 50 mm/min, respectively. The XRD measurements revealed the presence of approximately equal volume fractions of ferrite (51%) and austenite (49%) phases in the stir zone (SZ). The formation of low-angle grain boundaries through the occurrence of dynamic recovery along with the presence of shear texture components in both constituent phases of ferrite and austenite in the SZ approved the occurrence of continuous dynamic recrystallization throughout the evolved microstructure. Moreover, microstructural observations showed the formation of necklace structure through the microstructure of ferrite in the SZ. Taylor map approved the strain localization in the ferrite phase. Micro-hardness measurement indicated that the hardness value is increased in the SZ. The result of tensile test showed that fracture occurred from less ductile ferritic base metal.