This study used a unique, low-power (2.8 kW) gas tunnel plasma spray and γ-Al2O3 feedstock powder to deposit a thin Al2O3 coating (<2 µm) on mild steel substrate. By optimising the plasma gas flow rate, powder feed rate, spraying time, and distance, a dense and homogeneous Al2O3 coating was obtained at a very high deposition rate (150 nm/s). During plasma coating, the high energy density plasma transforms the γ-Al2O3 powder into a highly crystalline α-Al2O3 as the predominant microstructure of the coating. The performance of the Al2O3 coating on mild steel was then evaluated preliminary using a linear sliding wear test against a chrome-steel ball, with the results indicating an 18–26% reduction in wear when compared to the uncoated substrate.