Virtually all manufacturing processes, including machining, EDM, ECM, grinding, welding, and even plating create tensile stresses on the surface of the part. These tensile stresses try to pull apart the surface fibers of the material. Applying external loads magnifies these tensile stresses. When these loads are repeatedly applied, thousands or millions of time, a part may develop stress cracks (metal fatigue) and fail due to the effect of the tensile stresses pulling apart the surface fibers of the material.
Shot peening is a cold working process that bombards the surface of the part with round media called shot, creating a compressive stress layer at or near the surface of the material. Each piece of shot hits the part like a ball-peen hammer and makes a small dimple. The surface grains of the material bend in tension, while below the surface, the compressed grains of the material try to regain their shape, creating an area highly stressed in compression. Overlapping dimples create a uniform layer of residual stresses in compression on the surface of the material.
Experience has shown, and science has proven, that stress cracks will not initiate or propagate in compressively stressed regions of the material. Essentially, all metal fatigue failure occurs at or near the surface of the part.