We present a general theory of atomistic dynamical response in surface probe microscopy when two solid surfaces move with respect to each other in close proximity, when atomic instabilities are likely to occur. These instabilities result in a bistable potential energy surface, leading to temperature dependent atomic scale topography and damping (dissipation) images. The theory is illustrated on noncontact atomic force microscopy and enables us to calculate, on the same footing, both the frequency shift and the excitation signal amplitude for tip oscillations. We show, using atomistic simulations, how dissipation occurs through reversible jumps of a surface atom between the minima when a tip is close to the surface, resulting in dissipated energies of 1.6 eV. We also demonstrate that atomic instabilities lead to jumps in the frequency shift that are smoothed out with increasing temperature.