Abstract: As powerful techniques for multidisciplinary research, the neutron and synchrotron radiation sources have the advantages of deep penetration and high brilliance, providing advanced and powerful tools for characterizing microstructures and revealing deformation/damage micromechanisms of materials. For research on engineering materials, such as advanced steel, superalloy, titanium alloy, and aluminum alloy, it is necessary to develop advanced in-situ microstructure and stress characterization methods to reveal the evolution of the multiscale microstructures and stress fields during preparation and service and investigate the micromechanical behaviors, including deformation damage and phase transformation, under complex external factors, such as temperature, stress, electric, and magnetic fields. The basic principles of quantitative characterization of texture and multiscale stress using neutron and X-ray diffraction (XRD) techniques were introduced in this paper. The global development and status of advanced characterization techniques based on neutron and synchrotron radiation sources were expounded. The advantages of neutron and synchrotron radiation techniques were also analyzed. The application of neutron and synchrotron-based XRD techniques in the research of structural engineering materials and components, thermoelastic martensitic transformation, and new structural materials were reviewed. The use of neutron diffraction and HE-XRD techniques on structural engineering materials mainly focuses on multiphase microstructure evolution, intergranular and interphase stress distribution in elastic/plastic zone during deformation, and temperature/stress-induced phase transformation behaviors. The microscopic stress measurement is crucial for verifying the micromechanical model of engineering structural material, which is closely related to the texture evolution during the deformation and phase transformation. The simultaneous acquisition of microscopic stress and macroscopic stress can provide essential data for the service reliability and failure evaluation standards of engineering structural materials/components. Using the μXRD characterization method with submicron resolution, through the combination of monochromatic and polychromatic diffraction analysis, the precise characterization of large stress gradient and slight orientation gradient, caused by the dislocation structures inside the grain, can be realized to achieve submicron damage evaluation. The research on thermoelastic martensitic transformation by neutron scattering (diffraction) and HE-XRD technology includes external field-assisted thermoelastic martensitic transformation, narrow hysteresis thermoelastic martensitic transformation, and colossal elastocaloric effect. Neutron diffraction and HE-XRD techniques have advantages in studying emerging structural materials, such as high-entropy alloys and heterogeneous materials, which often have complex microstructures and exhibit unique mechanical behaviors and are important for revealing their deformation and damage mechanisms. The neutron and synchrotron-based technology, combined with in-situ environmental devices, can be used to measure and analyze the multiscale microstructures/stress and service damage behaviors of key engineering components in a near-service environment. Finally, the development and application of characterization techniques based on neutron and synchrotron radiation sources have prospects.