Abstract: Based on the techniques of surface mechanical attrition treatment (SMAT) and warm co-rolling, laminated and nanostructured materials with high strength and exceptional ductility could be produced. In order to study the deformation behavior and associated damage initiation/evolution process in the layered co-rolled SMATed 304 stainless steel, the cohesive finite element method (CFEM) was employed to generate a model which could be used to predict the mechanical properties of the material. Based on the model, the effects of nanograin layer properties such as normal cohesive strength, tangential cohesive strength, fracture energy and volume fraction on the overall strength and ductility were investigated. The comparison between simulation result and experimental result demonstrates that the model is reasonable and accurate. Meanwhile, the predicted results indicate that the ductility of material increases with the increasing of nanograin layer cohesive strength and the decreasing of nanograin layer fracture energy. With increasing the volume fraction of the nanograin layer, the ductility of the material reduces, but the strength increases.