Welding process generates distortion and residual stress in the weldment due to rapid heating and cooling. Welding distortion and residual stress in the welded structure result in many troubles such as dimensional inaccuracies in assembling and safety problem during service. The accurate prediction of welding residual stress is thus very important to improve the quality of weldment and find the way to reduce itself. This paper suggests new analysis method to predict welding residual stress by considering solid phase transformation during welding process. Using the method, analysis is performed for medium and low carbon steel. The analysis result for medium carbon steel reveals that case considering phase transformation has compressive residual stress in contrast with the case neglecting phase transformation because of martensite formation. However, for the case of low carbon steel, residual stress shows little difference between the case considering phase transformation and the other case, because it has small transformation strain and recovers rapidly stress after phase transformation.