We have investigated the formation mechanisms of nanostructures within adiabatic shear bands formed in stainless steel samples deformed by high-strain-rate forced shear. Twinning is shown to play a critical role in the initiation of nanostructures. Secondary twins directly led to the formation of elongated subgrains. Microtwins inside shear bands promoted division and break-down of the subgrains, which further refined the microstructures.