The microstructures and mechanical properties of friction stir welded lap joints of Inconel 600 and SS 400 were evaluated; friction stir welding was carried out at a tool rotation speed of 200 rpm and welding speed of 100 mm/min. Electron back-scattering diffraction and transmission electron microscopy were introduced to analyze the grain boundary characteristics and the precipitates, respectively. Application of friction stir welding was notably effective at reducing the grain size of the stir zone. As a result, the reduced average grain size of Inconel 600 ranged from 20 μm in the base material to 8.5 μm in the stir zone. The joint interface between Inconel 600 and SS 400 showed a sound weld without voids and cracks, and MC carbides with a size of around 50 nm were partially formed at the Inconel 600 area of lap joint interface. However, the intermetallic compounds that lead to mechanical property degradation of the welds were not formed at the joint interface. Also, a hook, along the Inconel 600 alloy from SS 400, was formed at the advancing side, which directly brought about an increase in the peel strength. In this study, we systematically discussed the evolution of microstructures and mechanical properties of the friction stir lap joint between Inconel 600 and SS 400.