Intrinsic stacking fault energy (SFE) values of gamma-Fe and AISI 304 austenitic stainless steels were determined as a function of carbon and nitrogen content using ab initio calculations. In contrast to previous investigations, the analysis was conducted incorporating the paramagnetic state to account for the magnetic constitution of real austenitic stainless steels. The effect of finite temperature was partially accounted for by performing ab initio calculations at the experimental volumes at room temperature. Including paramagnetism in gamma-Fe increases the SFE of non-magnetic gamma-Fe by similar to 385 mJ.m(-2). Interstitial alloying of non-magnetic gamma-Fe causes a linear increase in intrinsic stacking fault energy with interstitial content. In comparison, interstitial alloying of paramagnetic gamma-Fe increases the SFE at only about half the rate. The SFE of paramagnetic interstitial-free AISI 304 is within the range of -12 to 0 mJ.m(-2) and only deviates slightly from the SFE of paramagnetic gamma-Fe. It follows a similar, albeit flatter linear dependency on the interstitial content compared to gamma-Fe. Both gamma-Fe and gamma-AISI 304 were found to be metastable in their interstitial-free condition and are stabilized by interstitial alloying. The possible effect of short range ordering between interstitials and Cr on the SFE was discussed. The calculated threshold nitrogen content necessary to stabilize austenite in AISI 304 is in good agreement with experimental investigations of deformation microstructures in dependence of the nitrogen content. Finally, the calculated negative SFE values of AISI 304 were reconciled with experimentally determined positive SFE values using a recent method that accounts for the kinetics of stacking fault formation.