Cryomilling combined with laser induction hybrid cladding (LIHC) was adopted to produce NiCrAlY coatings on Ni-based superalloy. The characteristics, oxidation resistance, and mechanical properties of the cryomilled NiCrAlY coatings by LIHC were investigated. By increasing the cryomilling time, the as-received spherical powder experienced a transition from flake-shaped to polygonal structure. The particle size increased firstly and then decreased. Moreover, increasing the cryomilling time induced the columnar growth in the NiCrAlY coatings. This in turn improved the oxidation resistance and the mechanical properties of the coatings. Especially, when the cryomilling time was increased to 15 h, the oxidation resistance of the coating at 1423 K was approximately nine times than that of GH4169 superalloy. The tensile strength of the cryomilled (15 h) coating increased to 1085 MPa and the ductility was 20.7%.