The formation of hydrides challenges the integrity of zirconium (Zr) fuel cladding in nuclear reactors. The dynamics of hydride precipitation are complex. Especially, the formation of the butterfly or bird‐nest configurations of dislocation structures around hydride is rather intriguing. By in‐situ transmission electron microscopy experiments and density functional theory simulations, it is discovered that hydride growth is a hybrid displacive‐diffusive process, which is regulated by intermittent dislocation emissions. A strong tensile stress field around the hydride tip increases the solubility of hydrogen in Zr matrix, which prevents hydride growth. Punching‐out dislocations reduces the tensile stress surrounding the hydride, decreases hydrogen solubility, reboots the hydride precipitation and accelerates the growth of the hydride. The emission of dislocations mediates hydride growth, and finally, the consecutively emitted dislocations evolve into a butterfly or bird‐nest configuration around the hydride.