A proper dielectric coating can reduce the electromagnetic scattering of the conducting object significantly so that it cannot be detected by the radar. However, when the object contains a thin coating, fine grid size is needed to discretize the thin coating in the conventional finite-difference time-domain (FDTD) algorithm, which increases the amount of memory and computational time significantly. To overcome this dilemma, we present a transformation optics-based FDTD (TO-FDTD) algorithm to accelerate the solution of electromagnetic scattering from objects with thin dielectric coatings. Two kinds of novel TO-FDTD models are proposed in this paper for a coated cylinder and a coated arbitrary polygonal cylinder, respectively. Through coordinate transformation, the size of the object remains unchanged while its thin coating is enlarged to a thicker one, meaning that it can be simulated by the FDTD algorithm with uniform coarse grids instead of fine grids. The transformed material parameters become inhomogeneous and anisotropic in the transformed region, which can be obtained by solving a Jacobian transformation matrix. We then develop a stable FDTD algorithm for solving anisotropic Maxwell's equations. Bistatic scatterings of coated cylinders and a coated polygonal cylinder are solved by the TO-FDTD algorithm proposed in this paper, respectively. The result of the TO-FDTD algorithm matches well with the exact value and the result of the commercial software Comsol. The computational efficiency and accuracy of the proposed TO-FDTD algorithm are validated by numerical experiments. Numerical results show that the TO-FDTD algorithm has higher computational accuracy than the conventional FDTD algorithm that fails to simulate the absorbing property of the coating, when the same coarse grid size is used in the simulation. Under the same level of accuracy, the proposed TO-FDTD method can improve the computational efficiency by 62-63 times than the conventional FDTD method with fine grids in the simulations in the paper. INDEX TERMS Coated object, finite-difference time-domain (FDTD), radar cross section (RCS), transformation optics.