The objective of this research work is to improve the microstructure of SS316H TIG weldments that undergo drastic changes after fusion welding. The weldment is formed by a combination of the weld zone, partially molten zone, and heat affected zone (HAZ) areas. In all these, the properties of the heat affected area get deteriorated due to excessive amount of heat. The novel ultrasonic vibration with moderate cooling (UVMC) setup is used to mitigate the formation of hard precipitation and liquation cracking in weldments, especially HAZ area. The welding parameters in terms of heat input and UVMC parameters in terms of ultrasonic frequency, power, and water flow rate were selected. Microstructural changes were found to be more prominent at higher ultrasonic frequency with higher power of UVMC setup. Hardness values were found to be lower in UVMC set samples compared to samples without UVMC. Therefore, improvement in weld HAZ microstructure to improve efficiency and strength to weight ratio would be very useful for applications in the fields of automobile, aerospace, structural and chemical industries.