The reduction of ductility of austenitic stainless steels as a result of long-term operation in the nuclear reactor core is an important problem of modern radiation materials science. Understanding the mechanisms of the effect of neutron irradiation on the mechanical properties of austenitic steels is impossible without research of localization processes occurring during the deformation. In this paper, it was found that the value of the true local deformation corresponding to the onset of neck formation in face-centered cubic structured metals decreases with an increase in the radiation dose, while the true stress remains almost constant. Additional hardening of AISI 304 steel due to the intensive formation of the martensitic α’-phase increases not only the stress at which a neck is formed in this alloy, but also the true local deformation. As a result, the uniform elongation increases and remains high after neutron irradiation to 0.05 dpa. The forehanded formation of the martensitic α’-phase in sufficient quantity before the necking onset can be considered as an additional deformation mechanism that will increase the ability of the material to deform uniformly.