A hybrid in-situ characterization system, which couples the laser scanning confocal microscopy (LSCM) with the time-resolved X-ray diffraction (TRXRD) measurement with synchrotron radiation, was used to characterize the microstructure evolution during heat-affected zone (HAZ) thermal cycling of high-strength and blast-resistant steel. The combined technique has a time resolution of 0.3 seconds that allows for high-fidelity measurements of transformation kinetics, lattice parameters, and morphological features. The measurements showed a significant reduction in the martensite start transformation temperature with a decrease in the prior austenite grain size. In addition, the LSCM images confirmed the concurrent refinement of martensite packet size with smaller austenite grain sizes. This is consistent with dilatometric observations. The austenite grain size also influenced the rate of transformation (df (m) /dT); however, the measurements from the hybrid (surface) and dilatometric (volume) measurements were inconsistent. Challenges and future directions of adopting this technique for comprehensive tracking of microstructure evolution in steels are discussed.