Laterally epitaxial single crystalline Ag2Te nanowires (NWs) are synthesized on sapphire substrates by the vapor transport method. We observed the phase transitions of these Ag2Te NWs via in situ transmission electron microscopy (TEM) after covering them with Pt layers. The constrained NW shows phase transition from monoclinic to a body-centered cubic (bcc) structure near the interfaces, which is ascribed to the thermal stress caused by differences in the thermal expansion coefficients. Furthermore, we observed the nucleation and growth of bcc phase penetrating into the face-centered cubic matrix at 200 degrees C by high-resolution TEM in real time. Our results would provide valuable insight into how compressive stresses imposed by overlayers affect behaviors of nanodevices.