The governing mechanistic behaviour of Directed Energy Deposition Additive Manufacturing (DED-AM) is revealed by a combined in situ and operando synchrotron X-ray imaging and diffraction study of a nickel-base superalloy, IN718. Using a unique DED-AM process replicator, real-space imaging enables quantification of the melt-pool boundary and flow dynamics during solidification. This imaging knowledge was also used to inform precise diffraction measurements of temporally resolved microstructural phases during transformation and stress development with a spatial resolution of 100 µm. The diffraction quantified thermal gradient enabled a dendritic solidification microstructure to be predicted and coupled to the stress state. The fast cooling rate entirely suppressed the formation of secondary phases or recrystallisation in the solid-state. Upon solidification, the stresses rapidly increase to the yield strength during cooling. This insight, combined with the large solidification range of IN718 suggests that the accumulated plasticity exhausts the ductility of the alloy, causing liquation cracking. This study has revealed the mechanisms that govern the formation of highly non-equilibrium microstructures during DED-AM.