Microstructure and crystallography of δ phase hydrides in as-received fine grain and ‘blocky alpha’ large grain Zircaloy-4 (average grain size ∼11 μm and >200 μm, respectively) were examined using electron backscatter diffraction (EBSD). Results suggest that the matrix-hydride orientation relationship is {0001} α ||{111} δ ;<112¯0> α ||<110> δ for all the cases studied. The habit plane of intragranular hydrides and some intergranular hydrides has been found to be {101¯7} of the surrounding matrix. The morphology of intergranular hydrides can vary depending upon the angle between the grain boundary and the hydride habit plane. The misfit strain between α-Zr and δ-hydride is accommodated mainly by high density of dislocations and twin structures in the hydrides, and a mechanism of twin formation in the hydrides has been proposed. The growth of hydrides across grain boundaries is achieved through an auto-catalytic manner similar to the growth pattern of intragranular hydrides. Easy collective shear along <11¯00> makes it possible for hydride nucleation at any grain boundaries, while the process seems to favour grain boundaries with low (<40°) and high (>80°) c-axis misorientation angles. Moreover, the angle between the grain boundary and the adjacent basal planes does not influence the propensity for hydride nucleation.