Steam oxidation of austenitic heat-resistant steels TP347H and TP347HFG at 650–800 °C was investigated. Comprehensive micro-characterization technologies containing Scanning Electron Microscope (SEM), Energy Dispersive X-ray Spectroscopy (EDS), X-ray Diffraction (XRD), and X-ray Photoelectron Spectroscopy (XPS) were employed to observe and analyze the oxidation products. Results show that breakaway oxidation behaviors were observed on TP347H at 700 °C and 800 °C. The oxidation kinetics of TP347HFG at 650–800 °C followed a parabolic law. The oxide scales formed on TP347HFG were composed of MnCr2O4 and Cr2O3. A thin and protective Cr-rich oxide scale was replaced by Fe2O3 nodules due to the insufficient outward migration of metallic ions, including Cr and Mn at the subsurface of coarse-grain TP347H. Smaller grain of TP347HFG promoted the formation of the compact Cr-rich oxide scales. At higher temperatures, the incubation period for breakaway oxidation of the Cr-rich oxide scale was much shorter because of quick evaporation of the Cr2O3 oxide scale and the slower outward diffusion of metallic ions via the grain boundaries.