X-ray diffraction (XRD) and transmission electron microscopy (TEM) were used to investigate the evolution of damage during implantation of 300 keV Eu ions at room temperature in AlN. At low fluence, a strain increase is observed in a buried layer where clusters of point defects and stacking faults (SFs) coexist. At higher fluence, a saturation of the strain is observed in this layer, and the XRD curves exhibit characteristic features which coupled with TEM results enable the identification of additional, spatially separated, dilated and contracted regions. From these observations, the following damage mechanisms are proposed. As the SFs grow by trapping point defects, a dense network of basal and prismatic SFs forms, which leads to the ejection of point defects from the buried damaged layer and consequently to the saturation of the strain. In this process, interstitials in excess migrate towards the undamaged bulk where they form clusters inducing large strain values. In contrast, defects ejected towards the surface either remain isolated or form isolated dislocation loops and SFs depending on their nature, i.e., interstitial or vacancy. This is probably the main difference with GaN where the defects ejected from the buried damaged layer contribute to the fast propagation of the dense SFs network towards the surface due to their relatively low formation energies. As a consequence, whilst nanocrystallization occurs at the surface of GaN, the relative confinement of defects and implanted atoms in the buried layer of AlN results in its amorphization, although at extremely high fluences (∼10^17 Eu/cm^2).