The grinding process is currently used for most of the parts requiring good precision. However, the apparition of some damage related to this process is still uncontrolled. The major deterioration is from residual stress. In order to investigate the residual stresses caused by mechanical plastic deformation, thermal plastic deformation and phase transformation in ground components, a feasible numerical method was developed to accommodate appropriately thermal stress and phase transformation in a workpiece experiencing critical temperature variation during grinding. The change of the material properties was modeled as function of temperature history. The wheel velocity Vs is a key factor in determining the distribution of residual stress; both the surface residual stress and the depth of residual stress are induced with the increase of the wheel speed.