The product quality of selective laser melting (SLM) is closely related to the alloy powder characteristics, including the size distribution and the oxygen content. In this work, the 316L stainless steel powder was prepared by a vacuum atomization furnace and sieved into a normal-sized distribution range from 15 to 53 μm with a median diameter of 37.4 μm, and a fine-sized distribution range from 10 to 38 μm with a median diameter of 18.9 μm. Then they were mixed with each other in different proportions. The results show that, under the condition of the same SLM parameters, the SLM part, with adding a large amount of fine-sized powder, has a lower density and strength, as well as more holes and spheroidized particles, compared with the SLM part with adding a small amount of finer-sized powder. Furthermore, the 316L stainless steel powder with a high oxygen content was prepared by a non-vacuum atomization furnace. Although the 316L stainless steel powder with a high oxygen content can be evenly spread in the SLM process, the surface layer of the powder is easy to form an oxide film during the cooling and solidification of powder inside the molten pool. Under the action of thermal stress, the small crack forms and expands along the oxide film, eventually leading to large cracks inside the melt channel.