Abstract: Based on SYSWELD code,a computational approach was developed to simulate the temperature field and residual stress distribution in a butt joint of P91 steel plates welded by laser beam. The influence of the volume change, yield strength variation and transformation induced plasticity (TRIP) due to austenite-martensite transformation on welding residual stresses was numerically investigated. The simulation results showed that both volumetric change and yield strength variation have significant influence on the distribution and magnitude of welding residual stress. The influence of TRIP seems to be inferior to the former two factors, but it can relax both the longitudinal and transverse residual stresses to some extent in the weld zone and HAZ. Comparing the simulation results with the measured data obtained from the opening literature, we can find that the longitudinal residual stresses predicted by the present numerical model generally are in good agreement with the measurements obtained by neutron diffraction technique. When TRIP is considered in the finite element model, the simulation results match the measurements better.