In this review article, microstructure and mechanical behavior of the dissimilar welded joint (DWJ) between ferritic-martensitic steel and austenitic grade steel along with its application have been summarized in Ultra Super Critical (USC) power plant. Creep-strength enhanced ferritic-martensitic (CSEF/M) P91 steel was developed to sustain at extreme operating conditions of ultra-supercritical (USC) power plants, and later, P92 was developed to achieve better mechanical properties, higher creep-rupture strength and high operating temperature with the reduction in wall thickness as compared to P91 steel. The most common application of P91/P92 material in power plants includes high pressure and high-temperature steam piping, headers, super-heater tubing, and water-wall tubing. The other most commonly used material in the power plants is austenitic stainless steel, i.e., SS 304 L. The austenitic grade stainless steel offers high resistance to corrosion due to the high wt. % chromium and nickel content (18–20 and 8–12, respectively). Due to the low carbon content, the SS 304 L is less sensitive to the sensitization problem and offers excellent weldability. The joining of these dissimilar materials is frequently required in the power generation industry. The current review focuses on the main difficulty associated with dissimilar welding of martensitic P91/P92 and austenitic grade stainless steel. The different chemical composition, mechanical, physical and metallurgical properties of the martensitic P91/P92 and austenitic grade stainless steel leads to the problems such as hot cracking and carbon migration. The other weldability issues are the formation of a brittle intermetallic compound, the formation of soft transaction heat affected zone along with martensitic steel, δ ferrite formation in fusion zone, diffusion related problem, and residual stresses, which necessitates thorough study and qualification of welds. The effect of coarsening of various precipitates such as M23C6 carbides, MX carbonitrides, and effect of laves phase, z-phase, and sigma phase on mechanical property, and creep-rupture strength of DWJ are also discussed in detail. Based on the literature reviewed, it has been found that some of the above-stated problems can be solved by using nickel-based filler wire due to its intermediate physical and mechanical properties. The selection of the proper filler metal is another vital issue in dissimilar welds joint that is also covered in this review article. The reason behind the formation of the unmixed zone, filler deficient region, peninsula, island, beach, migrated grain boundaries, solidified grain boundaries, and solidified subgrain boundaries during DWJ of martensitic P91/P92 and austenitic grade stainless steel is also discussed. The heat treatment is required to eliminate the heterogeneous microstructure during the dissimilar welding. The effect of post-weld heat treatment (PWHT) on the microstructure and mechanical behavior of the DWJ also reviewed. The residual stress developed during the DWJ may cause the premature failure of the components under service, has also been discussed in detail. The effect associated with the residual stress deformation has been reviewed in the different conditions of the DWJ. © 2020 The Society of Manufacturing Engineers