The nucleation and development of dynamic recrystallization (DRX) in hot deformed superalloy Inconel 718 during uniaxial compression were investigated by optical microscopy and electron back-scattered diffraction (EBSD) technique. The results showed that the discontinuous dynamic recrystallization was the predominant DRX mechanism in this alloy. The variations of partial crystallographic orientations led to the individual nucleation inside the deformed grains, which implied the occurrence of local continuous dynamic recrystallization. The progressive subgrain rotation can be confirmed neither near the prior high angle grain boundaries nor within the original grains. It was found that, as the strain increased, the initial twin boundaries were gradually transformed to ordinary mobile high angle boundaries. Meanwhile, the new twin boundaries were formed inside the recrystallized grain necklaces. It was suggested that the characteristics of the twin boundaries evolution with increasing strain were associated with the transformation of initial twin boundaries as well as the generation of new ones, which resulted in the development of DRX.