The work addresses the effects of nanosize particles and grain refinement on the patterns of stress serrations and kinematics of deformation bands associated with the Portevin-Le Chatelier instability of plastic flow. Ultra-fine-grained microstructure was obtained using equal-channel angular pressing of the initial coarse-grained alloy. Tensile tests were carried out on flat specimens at strain rates in the range from 3 × 10 −5 to 1.4 × 10 −2 s −1. Using local extensometry techniques, it was found that the presence of nanoscale precipitates promotes quasi-continuous propagation of deformation bands in the entire strain-rate range. The grain refinement leads to a transition to relay-race propagation at high strain rates and static strain localization at low rates. The results are discussed from the viewpoint of competition between various dynamical modes of plastic deformation associated with collective dynamics of dislocations.