The aim of this report is to examine the influence of sensitization on the mechanical properties of AISI grade 304LN stainless steel with special emphasis on its fracture toughness. A series of stainless steel samples has been sensitized by holding at 1023 K for different time periods ranging from 1 to 100 hours followed by water quenching. The degree of sensitization (DOS) for each type of the varyingly heat-treated samples has been measured by an electrochemical potentiodynamic reactivation (EPR) test. The microstructures of these samples have been characterized by optical metallography, scanning electron microscopy, transmission electron microscopy (TEM), and X-ray diffraction (XRD) analyses, together with measurements of their hardness and tensile properties. The fracture toughness of the samples has been measured by the ball indentation (BI) technique and the results are validated by conducting conventional J-integral tests. It is revealed for the first time that the fracture toughness and ductility of AISI 304LN stainless steel deteriorate significantly with increased DOS, while the tensile strength (TS) values remain almost unaltered. The results have been critically discussed in terms of the depletion of solid solution strengtheners, the nature of the grain boundary precipitations, and the strain-induced martensite formation with the increasing DOS of the 304LN stainless steel.