Joining of dissimilar metals and alloys has been envisioned since a long time with specific high end applications in various fields. One such combination is austenitic stainless steel grade SS304 and commercial grade titanium, which is very difficult to join under conventional fusion process due to extensive cracking and failure caused by mismatch in structural and thermal properties as well as formation of the extremely brittle and hard intermetallic compounds. One of the methods proposed in literature to control the formation of intermetallics is by fast cooling fusion process like laser beam welding. The present study has been done on laser welding of titanium and stainless steel AISI 304 to understand the interaction of these materials during laser welding at different laser power and welding speed which could yield different cooling rates. Two types of cracks were observed in the weld joint, namely longitudinal cracks and transverse cracks with respect to the weld direction. Longitudinal cracks could be completely eliminated at faster welding speeds, but transverse cracks were found little influenced by the welding speed. The thermal history, i.e. melt pool lifetime and cooling rate of the molten pool during laser welding was monitored and a relation between thermo-cycle with occurrence of cracks was established. It is inferred that the longitudinal cracks are mainly due to the formation of various brittle intermetallic phases of Fe and Ti, which could be minimized by providing relatively less melt pool lifetime at high welding speeds. The reason of the transverse cracks could be the generation of longitudinal stress in weld joint due to the large difference in the thermal expansion coefficient of steel and titanium. In order to mitigate the longitudinal stress laser welding was carried out with a novel experimental arrangement which ensured different cooling rates of these two metals during laser welding. With this the tendency of transverse cracks also could be minimized significantly.