A micromechanical study of the effect of varying amounts of tensile strains on the microstructures and subsequent mechanical behaviors of superelastic Nitinol rods is presented. It is found that strains up to *8-9 % develop microstructures that assist both forward and reverse transformation relative to un-strained material. This superelastic phenomenon is explained to be analogous to two-way shape memory effect in Nitinol actuation materials. These results provide understanding as to why such ''pre-strains'' may lead to improvements in subsequent superelastic fatigue life. Beyond 9 %, a drastic change is observed, as large amounts of martensite (75 % and more) are retained in unloaded samples. Thus, a competition between transformation, plasticity, and reorientation is found to give rise to microstructures that inhibit complete transformation. Furthermore, even though similar inelastic strain magnitudes are observed in loading and unloading plateaus, micromechanical mechanisms differ substantially from samples with less pre-strain. For example, in highly pre-strained samples at least half of the plateau strains are due to martensite reorientation, whereas, in low and moderately pre-strained samples nearly the entirety of the plateau strain is due to transformation. We also find that latent heat of plastic flow is larger than latent heat of transformation.