The dynamics of deformation localization and dislocation channel formation were investigated in situ in a neutron-irradiated AISI 304 austenitic stainless steel and a model 304-based austenitic alloy by combining several analytical techniques including optic microscopy and laser confocal microscopy, scanning electron microscopy, electron backscatter diffraction, and transmission electron microscopy (TEM). Channel formation was observed at ∼70% of the polycrystalline yield stress of the irradiated materials ($\sigma$0.2). It was shown that triple junction points do not always serve as a source of dislocation channels; at stress levels below the $\sigma$0.2, channels often formed near the middle of the grain boundary. For a single grain, the role of elastic stiffness value (Young’s modulus) in channel formation was analyzed; it was shown that in the irradiated 304 steels the initial channels appeared in “soft” grains with a high Schmid factor located near “stiff” grains with high elastic stiffness. The spatial organization of channels in a single grain was analyzed; it was shown that secondary channels operating in the same slip plane as primary channels often appeared at the middle or at one-third of the way between primary channels. The twinning nature of dislocation channels was analyzed for grains of different orientation using TEM. In the AISI 304 steel, channels in grains oriented close to 〈0 0 1〉||TA (tensile axis) and 〈1 0 1〉||TA were twin free and grain with 〈1 1 1〉||TA and grains oriented close to a Schmid factor maximum contained deformation twins.