Superelastic behavior of laser welded NiTi is significantly different from the original base material due to microstructural changes introduced during welding. These are responsible for a higher accumulated irrecoverable strain during mechanical cycling. In order to clarify the mechanisms responsible for the evolution of the accumulated irrecoverable strain on superelastic laser welded NiTi, detailed synchrotron X-ray diffraction analysis was performed. Welded samples were analyzed as-welded, after 4 cycles at 10% strain and after 600 cycles at 10% strain. As-welded sample had thermally stabilized martensite in the heat affected and fusion zones due to the welding procedure. It was observed that after 4 cycles, stabilization of the stress induced martensite occurred in a massive way in the thermal affected regions, due to the introduction of defects which prevented the reverse transformation upon unloading. After 600 cycles no significant changes were observed in the thermal affected regions. However, evidence of martensite stabilization in the base material, which was fully austenitic, near the heat affected zone was observed.