The paper is proposed to experimentally investigate the flow instability of centrifugal compressors with vaned diffuser, and the instability inducement and mechanism at full operating range are presented and analyzed in detail. In this paper, the steady performance and transient evolution process of the compressor are measured by steady and dynamic sensors. Experimental results show that the compressor experiences diverse flow instability patterns at different operating conditions. At low rotating speeds, the compressor undergoes stable state, stall and deep surge successively with mass flow rate decreases and the inducement of the flow instability is the wave-like instability disturbance at the impeller inlet. At middle rotating speeds, the compressor experiences stable state, mild surge and deep surge successively with mass flow rate reduces, and the inducement of the flow instability is the spike-shaped instability disturbance at the diffuser inlet. At high rotating speeds, the compressor still experiences stable state, mild surge and deep surge, whereas the flow instability is dominantly induced by the characteristic of the entire compression system. The research results of this paper promote understandings of the instability mechanism and improvements of the stability of centrifugal compressors.