Compositional patterning in two-phase immiscible alloys during severe plastic deformation at elevated temperatures has been investigated. Kinetic Monte Carlo computer simulations were used to test the proposed idea that patterning derives from a dynamic competition between homogenization by forced chemical mixing and phase separation by thermally activated diffusion [P. Bellon and R.S. Averback, Phys. Rev. Lett.74, 1819 (1995) and F. Wu et al., Acta Mater.54, 2605 (2006)]. We utilize the concept of pair diffusion coefficients to compare thermal diffusion with forced chemical mixing and discuss the fundamentally different behavior with respect to pair separation distance in both mechanisms. While the general ideas of this model are verified and are in good quantitative agreement with our simulations, it is found that the dynamic processes of alloys under high-temperature shear are very complex, even in highly idealized systems, making experimental verification of this model very difficult. We illustrate our findings for a model AB alloy with properties similar to Cu–Ag by showing how alloy morphology and solubility depend on shear rate, temperature, and composition.