Shock-induced phase transformation (body-centered cubic α phase to hexagonal close-packed ε phase) in single crystal iron with a nano-void inclusion has been investigated by means of molecular dynamic (MD) simulation. The simulated sample is 17.2nm×17.2nm×17.2nm in size with 428341 atoms, and in the center of the sample settled a void of 1.12nm in diameter. The shock wave compression is generated by using a piston impact with the sample at velocities of 350m/s, 500m/s and 1087m/s, respectively. Shock wave propagates along the ［100］ direction in the sample. Results indicate that the existence of void is an important factor for inducing the phase transformation, which initially occurs around the void and mainly on the (011) and (011) planes, while with the increase of compression time it expands to the rest of the sample. By analyzing the moving history of atoms under shock wave compression, the phase transformation mechanism has been outlined. It is found that when the atoms at (011) planes slide to the void along ［011］ direction, they may have relatively different displacement, such that results in alternative positions compared to their initial location and yields the new structure (hcp).