According to our fatigue tests carried out at 20 Hz, R=0.1 on transversely butt-welded joints, fatigue strengths of as-welded specimens, that is, specimens having residual stress are higher than those of annealed specimens in short life range, but vice verse in long life range. This behavior seems to be concerned mainly with residual stress relaxation by applied loading. After analyzing the welding process, we conducted finite element analysis to quantify the degree of residual stress relaxation. By taking into account residual stress relaxation, modified Goodman diagram, and nominal stress, we evaluated the fatigue life of the welded joint from the S-N curve for the parent material. The estimated results are in a good agreement with the experimental results.