A two-dimensional finite element model using cohesive zone elements was developed to predict cracking in thin film coating-interlayer-substrate systems that are subjected to tensile loading. The constitutive models were chosen to represent a metal carbide/diamond-like carbon composite coating with a titanium interlayer and a steel substrate. Material properties of the coating and interlayer along with the cohesive finite element parameters were varied to study effects on stress distributions and coating cracking. Stress distributions were highly nonuniform through the coating thickness. Thus the initiation and arrest of tensile cracks differed from what is predicted by simple shear-lay theory. Intercrack spacing distributions resulting from the variation of different parameters were quantified and compared with those from experiments.