The effect of combined mechanical and thermal treatments in the magnetostructural properties was studied in Ni-Mn-Sn metamagnetic shape memory alloys, in which the extraordinary high stability of the L21 structure precludes the variation of atomic order by means of conventional thermal treatments. A Ni50Mn35Sn15 alloy has been mechanically milled and then annealed at different temperatures in order to produce different microstructural states. The evolution of both the internal stresses and the crystallite size upon annealing has been quantified and correlated to the evolution of the martensitic transformation features and the magnetic properties. It is found that the relaxation processes brought by annealing leads to recovery of the martensitic transformation and the enhancement of the magnetism at both macroscopic and local level. In particular, the density of non-magnetic inclusions (defects) and their stress field decrease upon annealing, thus leading to an increase of the saturation magnetization and a decrease of the martensitic transformation temperature range, respectively, which results in a higher magnetocaloric effect. The obtained results confirm that, once the transition temperature has been fixed by the composition, the modification of the microstructure through thermomechanical treatments appears as the best way to tune the functional properties of these alloys.