The article presents the results of investigation of ultra-strength nanostructured bainitic steel Fe-0.6%C-1.9%Mn-1.8%Si-1.3%Cr-0.7%Mo (in wt. %) subjected to shear and uniaxial compression under high strain rate loading. Steel of microstructure consisted of carbide-free bainite and carbon enriched retained austenite presents a perfect balance of mechanical properties especially strength to toughness ratio. Two retained austenite morphologies exist which controlled ductility of the steel: film between bainite laths and separated blocks. It is well established that the strain induced transformation of carbon enriched retained austenite to martensite takes place during deformation. Shear localisation has been found to be an important and often dominant deformation and fracture mode in high-strength steels at high strain rate. Deformation tests were carried out using Gleeble simulator and Split Hopkinson Pressure Bar. Shear and compression strength were determined and toughness and crack resistance were assessed. Susceptibility of nanostructured bainitic steel to the formation of adiabatic shear bands (ASBs) and conditions of the bands formation were analysed. The results suggest that the main mechanism of hardening and failure at the dynamic shearing is local retained austenite transformation to high-carbon martensite which preceded ASBs formation. In the area of strain localization retained austenite transformed to fresh martensite and then steel capability to deformation and strengthening decreases.