In this work, shot peening was performed in a metastable austenitic stainless steel EN 1.4318 (AISI 301LN) in order to evaluate its effect on austenite to martensite phase transformation and also the influence on the fatigue limit. Two different steel conditions were considered: annealed, i.e., with a fully austenitic microstructure, and cold rolled, consisting of a mixture of austenite and martensite. X-ray diffraction, electron backscattered diffraction and focus ion beam, as well as nanoindentation techniques, were used to elucidate deformation mechanisms activated during shot peening and correlate with fatigue response. Results pointed out that extensive plastic deformation and phase transformation developed in annealed specimens as a consequence of shot peening.However, the increase of roughness and the generation of microcracks led to a limited fatigue limit improvement. In contrast, shot peened cold rolled specimens exhibited enhanced fatigue limit. In the latter case, the main factor that determined the influence on the fatigue response was the distance from the injector, followed successively by the exit speed of the shots and the coverage factor.