We have assessed the impact of the welding parameters on the nano-sized oxide dispersion and the grain size in the matrix of an ODS steel after friction stir welding. Our results, based on combined small angle neutron scattering and electron microscopy, reveal a decrease in the volume fraction of the particles smaller than 80 nm in the welds, mainly due to particle agglomeration. The increase in tool rotation speed or decrease in transverse speed leads to a higher reduction in nano-sized particle fraction, and additionally to the occurrence of particle melting. The dependence of the average grain size in the matrix on the particle volume fraction follows a Zener pinning-type relationship. This result points to the principal role that the particles have in pinning grain boundary movement, and consequently in controlling the grain size during welding.