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A set of AlGaN/GaN high electron mobility transistor devices has been investigated using step-stress testing, and representative samples of undegraded, source-side-degraded, and drain-side-degraded devices were examined using electron microscopy and microanalysis. An unstressed reference sample was also examined. All tested devices and their corresponding transmission electron microscopy samples originated from the same wafer and thus received nominally identical processing. Step-stressing was performed on each device and the corresponding current–voltage characteristics were generated. Degradation in electrical performance, specifically greatly increased gate leakage current, was shown to be correlated with the presence of crystal defects near the gate edges. However, the drain-side-degraded device showed a surface pit on the source side, and another region of the same device showed no evidence of damage. Moreover, significant metal diffusion into the barrier layer from the gate contacts was also observed, as well as thin amorphous oxide layers below the gate metal contacts, even in the unstressed sample. Overall, these observations emphasize that gate-edge defects provide only a partial explanation for device failure.