Due to the increasing maintenance costs of hydraulic machines related to the damages caused by cavitation erosion and/or erosion of solid particles, as well as in tribological connections, surface protection of these components is very important. Up to now, numerous investigations of resistance of coatings, mainly nitride coatings, such as CrN, TiN, TiCN, (Ti,Cr)N coatings and multilayer TiN/Ti, ZrN/CrN and TN/(Ti,Al)N coatings, produced by physical vapor deposition (PVD) method using different techniques of deposition, such as magnetron sputtering, arc evaporation or ion plating, to cavitation erosion, solid particle erosion and wear have been made. The results of these investigations, degradation processes and main test devices used are presented in this paper. An effect of deposition of mono- and multi-layer PVD coatings on duration of incubation period, cumulative weight loss and erosion rate, as well as on wear rate and coefficient of friction in tribological tests is discussed. It is shown that PVD coating does not always provide extended incubation time and/or improved resistance to mentioned types of damage. The influence of structure, hardness, residence to plastic deformation and stresses in the coatings on erosion and wear resistance is discussed. In the case of cavitation erosion and solid particle erosion, a limit value of the ratio of hardness (H) to Young’s modulus (E) exists at which the best resistance is gained. In the case of tribological tests, the higher the H/E ratio and the lower the coefficient of friction, the lower the wear rate, but there are also many exceptions.