Cold work and heat treatment influence the mechanical properties, residual stress-state, and corrosion resistance of austenitic stainless steels. In this study we have examined changes in the defect substructure and microstructure of Type 304 stainless steel resulting from surface preparation, and deposition of bond coats and thick ceramic coatings using plasma spray methods. The structure of the stainless steel was examined as a function of depth from the coating surface using optical and transmission electron microscopy, and x-ray diffraction. Grit blasting was found to severely cold work the material to a depth of tens of microns, and the amount of cold work varied with measured abrasive particle velocity. The heat input to the surface as a result of depositing a metallic bond coat or thick ceramic coating resulted in substantial annealing of the cold work imparted into the substrate by surface preparation. There was, however, no evidence of change in grain size near the substrate-coating interface that could be attributed to recrystallization or grain growth in the substrate.