In the present study, st37 steel and 304 stainless steel with a thickness of 2 mm, were welded successfully by friction stir spot welding process at tool dwell times of 2 s, 6 s, 10 s and tool rotational speeds of 630, 1000 and 1250 rpm. X-Ray Diffraction(XRD)and Energy-Dispersive x-ray Spectroscopy(EDS) experiments were used to investigate the possible formation of phases such as chromium carbide. Metallographic examinations, tensile/shear and microhardness tests were carried out to evaluate the joint. Four different zones were found in the weld area in additional to base metals. In the stir zone of the st37 steel, the hot deformation in the austenite region produced small austenite grains and these grains transformed to fine ferrite and pearlite and some products of displacive transformations such as Widmanstatten ferrite and martensite by cooling the material after friction stir welding. The heat-affected zone in the st37 steel side showed partially and fully refined microstructures like fusion welding processes. In the stir zone of the 304 stainless steel, a refined grain structure with some features of dynamic recrystallization was evidenced. A thermomechanically-affected zone was characterized on the 304 steel side with features of severe deformed grains. The recrystallization in the 304 steel and the transformations in the st37 steel enhanced the hardness of the weld area. In this work, it was observed that with increasing tool rotational speed, tensile/shear strengths increases. Bond length along the interface between the metal as an effective parameter to increase the tensile / shear strength was determined. To compare the mechanical strength, dissimilar resistance spot welding were also performed on samples. It was found that the optimum welding parameters in friction stir spot weld have higher strength than resistance spot weld. By performing tensile/shear test on resistance spot weld, joint strength was obtained of 356 MPa while the maximum strength of 512 MPa have been in friction stir spot welds under optimum welding parameters. Also Due to differences in the mode of fracture, higher maximum tolerated load was obtained on dissimilar welding of carbon steel to 304 stainless steel than similar of carbon steel and 304 stainless steel welds under same condition. With fracture mode analysis of samples obtained from tensile / shear test, two fracture modes was specified that included shear fracture mode and mixed shear-tensile fracture mode. With increasing rotational speed and dwell time of tool, fracture mode was changed from shear fracture mode to mixed shear-tensile fracture mode. Keywords: Friction stir spot welding, St37 steel, 304 stainless steel, Microstructure, Failure mode