Microstructure-dependent deformation and fracture behavior was investigated for an additively manufactured compositionally graded alloy (CGA) printed using the laser-directed energy deposition (L-DED) method to explore an alternative approach for dissimilar metal joints in nuclear energy systems. The electron backscatter diffraction (EBSD) maps from scanning electron microscopy (SEM) display a clear microstructural transition with decreasing austenite-forming elements (Ni and Mn), from an austenite (γ) dominant structure, to a complex composite structure containing ferrite (α), martensite (α′) and retained austenite, and then to a fully ferritic structure. EBSD data were recorded in situ during tensile testing in SEM, and the evolution of the deformation mechanism and microstructure was characterized using Kikuchi diffraction pattern analysis. Complementary analysis for high-resolution features was also performed using scanning transmission electron microscopy (STEM). The Ni/Mn-rich austenite-dominant microstructures showed a complex deformation mechanism of two-step martensitic transformation (γ→ε→α′), whereas the minor austenite phase retained in the ferrite and/or martensite matrix showed a single transformation route (γ→α′). Ordinary dislocation glide and twinning via partial dislocation glide were observed in the austenite deformation. Meanwhile, the ferrite and martensite grains deformed mainly by ordinary dislocation slips and grain rotation. Static tensile fracture was also highly dependent on local composition and phase constituents.