ULTIMET (R) alloy, a cobalt-based superalloy with good corrosion and wear resistant properties, exhibits a deformation-induced phase transformation from the face-centered-cubic (FCC) phase to the hexagonal-close-packed (HCP) phase. The HCP phase formation during monotonic tensile loading was investigated using in-situ neutron diffraction. The HCP phase is first observed at a stress level of 810 MPa, which is well beyond macroscopic yielding. Strain analysis is performed on the FCC phase diffraction data in order to relate the lattice-strain development with the evolution of the new HCP phase. A method of calculating the effective macroscopic stress associated with the measured lattice strains is presented here. The effective stress can then be compared to the applied macroscopic stress in order to draw conclusions about the load-partitioning behavior of the material as a new phase develops.