In this paper, the effects of ceria addition to HVOF thermal sprayed NiAl intermetallic coatings were investigated through micro-indentation, thermal shock testing, and microstructural analysis techniques including SEM with EDX, and XRD analysis. It has been found that the addition of ceria to NiAl coatings reduces the tendency of brittle peeling during thermal spraying. This reduction in peeling is presumably due to the improved wetting of the substrate by the molten coating material, which ultimately leads to better coating adhesion. The addition of ceria also resulted in higher coating hardness and elastic modulus as determined by micro-indentation. The coatings containing ceria also exhibited significant increases in thermal shock resistance when compared with that of the pure NiAl coatings. The possible mechanisms responsible for the improvement of the above mentioned properties upon the addition of ceria are also addressed in this paper.