The problem of stress corrosion cracking (SCC), which causes sudden failure of metals subjected to stress in a high-temperature, high-pressure water environment, is studied. Acoustic emission (AE) monitoring is a promising method for detecting the initiation and propagation of SCC. In this study, pencil-lead breaks are used as AE signal sources to first validate the parameters for the verification of the finite element modeling of microcracking. Then, a simplified fracture propagation model of low-carbon nitrogen-enhanced (316LN) stainless steel is established on the basis of moment tensor theory. Finally, the inner connection between the energy release rate of the AE source and the morphological aspect of crack formation is analyzed. The results of modal analysis show that the amount of energy released by the growing crack is linearly proportional to crack depth. Moreover, their frequency characteristics are almost unchanged from the results of analysis by fast Fourier transform. Therefore, SCC initiation and propagation in 316LN stainless steel can be evaluated by this detection method. Moreover, this analysis method based on the energy release rate of the AE source can also be extended to almost all solid materials and structural crack detection.