The effect of a 2 kW CO 2 laser working at different laser and processing parameters on features, microstructure, chemical composition, phases, hardness and fracture toughness of plasma sprayed and laser sealed plasma sprayed coatings of yttria partially stabilized zirconia (YSZ) containing 8 wt.% alumina was investigated. The plasma sprayed (YSZ) material containing Al 2 O 3 (YSZAl) showed high hardness and fracture toughness compared with YSZ. Fine cells and dendrites were formed after laser sealing as observed from the upper surface views and transverse sections, respectively. The amount of voids and crack width associated with laser sealing was reduced significantly in YSZAl sealed coatings. The coarse heterogeneous distribution of a-Al 2 O 3 and metastable tetragonal (t 0 ) phases in the plasma sprayed coating is changed to a fine scale duplex structure of t 0 + a-Al 2 O 3 in the sealed coatings. No cubic (c), transformable tetragonal (t) and monoclinic (m) phases were found for plasma sprayed and laser sealed coatings processed under optimum laser conditions. The rapid solidification caused by laser treatment prevents the transformation of the high temperature c phase to transform to the t and m phases; only the t 0 phase is formed by displasive athermal transformation. The fracture toughness of the sealed coatings was observed to increase by a factor of three as compared to that of plasma as-sprayed coating.