Using a laser to clad a mixture POwder of 60 V. -% ZrO2 plus 40 V.-% Nialloy preplaced on steel 4Cr13 substrate, a comPOSite coating that consists of a pure Zro2layer at the upper region and a Ni-alloy bonding zone adjacent to the substrate is formed. The microstructural analyses reveal that the ZrO2layer exhibits equiaxed grains at the upper part and a columnar structure at the lower part and is comPOsed of t-ZrO2 Phase and 2. 9% m-ZrO2 phase distributed along the t boundary. The bonding zone presents an even solidification microstructure composed of Ni-based dendrites and interdendritic eutectics. The stratification mechanism of the composite coating is interpreted as that the insoluble melts of ZrO2 and Ni-alloy powders undergo a redistribution before solidification due to density difference and interfacial tension between these two liquid phases, and then resolidify separately.