When extruded billet of AZ61 is compressed in warm temperature range in using grooved tool, mushroom deformation, that is, unstable deformation is generated. This behavior is limited in extruded billet, and this phenomenon has been investigated, but its mechanism is not clarified yet. Here, from view point of observation of microstructure, the effects of initial crystal orientation of billet and distribution of twin appeared in upsetting on mushroom deformation are researched. The mushroom deformation in upper side of upsetted specimen has a close correlation with twin generation.