Laser heating of HVOF Diamalloy 1005 sprayed on to the base materials of steel and Ti-6Al-4V alloy is considered and the laser melting of the resulting coating is investigated. Thermal stress fields developed at different layers of the coating after the laser treatment are simulated using the finite element method (FEM) and the residual stress developed in the coating is measured using the curvature method. It is found that the thermal displacement predicted at the coating/base material interface is significantly higher for Ti-6Al-4V alloy than that for the steel base. The residual stress predicted for the coating corresponding to the steel base is higher than that of Ti-6Al-4V alloy base.