Mechanical Milling (MM) is a Severe Plastic Deformation - Powder Metallurgy (SPD-PM) process which enables to produce a nano grain structure. A BCC layer with a nano grain structure appeared in the vicinity of the MM powder surface. Conventional cold work at room temperature never induces a strain-induced-martensitic-transformation in the SUS310S stainless steel. Therefore, a BCC layer formation from austenitic matrix is a specific phase transformation, and is attributed to the rise of the grain boundary energy by the nano grain formation. The hardness of this surface layer has approximately 540Hv, while that of the inner area has about 290Hv. As the MM powder anneals at 333K for 300s, the hardness of surface and inner area decreases to approximately 470Hv and 280Hv, respectively. Result of such a large hardness decrease in the surface of MM powder after annealing at near the room temperature indicates an existence of a huge number of defects, such as vacancy and interstitial atom, by the SPD-PM Process.