We present the first combined study of spatially resolved structure and shear rheology for a model shear banding fluid comprised of cetyltrimethylammonium bromide wormlike micelles. Combining conventional rheometry, velocimetry, flow birefringence, and flow-small angle neutron scattering (flow-SANS) in the 1-2 (flow-gradient) plane of shear completely characterizes shear banding in the system and enables comparison of local flow kinematics to local segmental orientation and alignment within the bands. The Giesekus constitutive equation with stress diffusion is shown to successfully model the viscoelasticity, steady shear viscosity, and shear banding kinematics. Flow-SANS measurements in the 1-2 plane exhibit a critical alignment and orientation required for shear banding, followed by a first order orientational transition to a paranematic state in the high-shear band. Master curves of the segmental orientation and alignment are constructed by comparing the local structural features to the locally observed shear rate. The Giesekus-diffusion model successfully predicts the measured segmental orientation and alignment, connecting the microstructure to the macroscopic rheology and shear banding kinematics. In doing so, a stress-SANS rule is developed, analogous to the stress-optic rule, that relates micellar flow alignment to the shear and normal stresses. The results confirm that shear banding is driven by a nonequilibrium shear-induced isotropic-nematic transition and suggest that the underlying phase behavior of the material is important in determining fluid microstructure and rheology during banding. (C) 2009 The Society of Rheology. [DOI: 10.1122/1.3089579]