An investigation has been made of the fine structure variation of thepolycrystalline Cu-Zn-Al shape memory alloy under martensite deformation by meansof TEM observation. Deformation, in the initial stage, is accomplished by thereorientation of variants, but the reorientation is often incomplete. After furtherreorientated, the interfaces among the prior variants still remain. A lot of twinswill appear in martensite under enormous deformation, and the twin plane is (001).The dislocations occur in some regions. In this case, the martensite will lose itsthermoelasticity and the shape memory effect will be damaged.