Toughness and hardness are important aspects for coating applications in manufacturing industry. Extensive theoretical and experimental efforts have been made to synthesize and study nanocomposite coatings with super hardness and high toughness. The materials can be hardened through various or combined hardening mechanisms. However, for engineering applications, coating toughness is as important as, if not more than, super hardness. At present, there is neither a standard test procedure, nor a standalone methodology for the assessment of thin film toughness. The determination of the toughness is still a difficult task, and very much a fully open problem. In this article, we review the hardening and toughening mechanisms of nanocomposite films, and the toughness characterization techniques. Based on these reviews, an outlook will be presented in the concluding remarks.magnified image