Stellites are a group of Co-Cr-C-W/Mo-containing alloys showing outstanding behavior under cavitation erosion (CE) operational conditions. The process of ion implantation can improve the CE resistance of metal alloys. This work presents the elaborated original phenomenological model of CE of nitrogen ion implanted HIP-consolidated (Hot Isostatically Pressed) cobalt alloy grade Stellite 6. The ultrasonic vibratory test rig was used for CE testing. The nitrogen ion implantation with 120 keV and fluence of 5 × 1016 N+/cm−2 improves HIPed Stellite 6 cavitation erosion resistance two times. Ion-implanted HIPed Stellite 6 has more than ten times higher CE resistance than the reference AISI 304 stainless steel sample. Comparative analysis of AFM, SEM and XRD results done at different test intervals reveals the kinetic of CE process. The model includes the surface roughness development and clarifies the meaning of cobalt-based matrix phase transformations under the nitrogen ion implantation and cavitation loads. Ion implantation modifies the cavitation erosion mechanisms of HIPed Stellite 6. The CE of unimplanted alloy starts on material loss initiated at the carbides/matrix interfaces. Deterioration starts with cobalt matrix plastic deformation, weakening the carbides restraint in the metallic matrix. Then, the cobalt-based matrix and further hard carbides are removed. Finally, a deformed cobalt matrix undergoes cracking, accelerating material removal and formation of pits and craters’ growth. The nitrogen ion implantation facilitates ɛ (hcp—hexagonal close-packed)) → γ (fcc—face-centered cubic) phase transformation, which further is reversed due to cavitation loads, i.e., CE induces the γ → ɛ martensitic phase transformation of the cobalt-based matrix. This phenomenon successfully limits carbide removal by consuming the cavitation loads for martensitic transformation at the initial stages of erosion. The CE incubation stage for ion implanted HIPed Stellite 6 lasts longer than for unimplanted due to the higher initial content of γ phase. Moreover, this phase slows the erosion rate by restraining carbides in cobalt-based matrix, facilitating strain-induced martensitic transformation and preventing the surface from severe material loss.