The edge structure and width of graphene nanoribbons (GNRs) are crucial factors for the electronic properties. A combination of experiment and first-principles calculations allows us to determine the mechanism of the hexagon-hexagon to pentagon-heptagon transformation. GNRs thinner than 2 nm have been fabricated by bombardment of graphene with high-energetic Au clusters. The edges of the GNRs are modified in situ by electron irradiation. Tensile strain along the edge decreases the transformation energy barrier. Antiferromagnetism and a direct band gap are found for a zigzag GNR, while a fully reconstructed GNR shows an indirect band gap. A GNR reconstructed on only one edge exhibits ferromagnetism. We propose that strain is an effective method to tune the edge and, therefore, the electronic structure of thin GNRs for graphene-based electronics.