We have investigated the interaction between slip traces and vicinal steps on the Nb(111) surface under increasing external strain. By exploiting an extended scanning tunneling microscopy analysis, we here show that emerging dislocations at the free-surface can induce the full disappearance of atomic terraces. To shed light on the observed behavior, we have modeled the elastic interaction between a screw dislocation and a vicinal step in the actual experimental configuration. After computing the adatom chemical potential, we show that strain-mediated diffusion on surface causes step erosion, possibly leading to vanishing of full terraces.