The manufacturing process for many large components of machines leads to a difference in their properties and performances based on changes in location. Functionally graded materials can meet these requirements and address the issue of generation and expansion of interface cracks. Ni204–dr60 gradient coatings were successfully fabricated using laser direct energy deposition (LDED). Microstructure mechanism evolution and microhardness of the gradient coating were comprehensively investigated. The change in the precipitated phase at the grain boundary and the intergranular zones resulted in a change in microstructural characteristics and also affected the microhardness distribution. The reinforced phase of the Ni204 → dr60 gradient zone from Ni204 to dr60 gradually precipitated and was rich in Mo and Nb phase, lath-shaped CrCx phase, network-shaped CrCx phase, block shape (Ni, Si) (C, B) phase, block CrCx phase, and block Cr (B, C) phase. The gradient coating thus acts as a potential candidate to effectively solve the problem of crack generation at the interface of dr60 and the substrate.