In conventional metals, charge carriers basically move freely. In correlated electron materials, however, the electrons may become localized because of strong Coulomb interactions, resulting in an insulating state. Despite considerable progress in the last decades, elucidating the driving mechanisms that suppress metallic charge transport, the spatial evolution of this phase transition remains poorly understood on a microscopic scale. Here, we use cryogenic scanning near-field optical microscopy to study the metal-to-insulator transition in an electronically driven charge-ordered system with a 20-nm spatial resolution. In contrast to common mean-field considerations, we observe pronounced phase segregation with a sharp boundary between metallic and insulating regions evidencing its first-order nature. Considerable strain in the crystal spatially modulates the effective electronic correlations within a few micrometers, leading to an extended "zebra" pattern of metallic and insulating stripes. We can directly monitor the spatial strain distribution via a gradual enhancement of the optical conductivity as the energy gap is depressed. Our observations shed new light on previous analyses of correlation-driven metal-insulator transitions.