A thermal barrier coating (TBC) of MCrAlY/8YSZ with hybrid microstructure was prepared on 15CrMo stainless steel by means of HVOF spraying technique, namely the coating consists of a hybrid structured YSZ top-coat made of mixture of agglomerated and fused and crushed YSZ powder and a bond coat of NiCoCrAlTaY, while an intermediate layer of NiCoCrAlTaY/YSZ composite was inserted in between the above two coats. The bonding strength and fracture toughness of the YSZ coating can be improved by these two strategies to enhance the spallation resistance of the TBC. Two individual powder feeders were used to feed the NiCoCrAlY and YSZ powder independently into the plasma plume so that the feeding rate and heating experience of both powders can be controlled independently. SEM was used to characterize the coating microstructure. Adhesion of the TBC coating was examined according to ASTM C633 Standard. Elastic modulus, fracture toughness and thermal conductivity of the YSZ layer were measured. Spallation resistance of the coating was assessed by water quenching test from 750°C. The results show that the desired coating microstructure was achieved by HVOF and APS, and all the three layers bond well each other without any interfacial cracks. The adhesion strength of the YSZ coat increases from 25.8 MPa to 38.6 MPa. Evident changes in elastic modulus and thermal conductivity were not detected. A great improvement of 100% in fracture toughness of the YSZ coating was achieved. As a result of all the above measures, the occurrence of 30% area spallation for the top coat could be rose to 72.1 cycles during water quenching test, in comparison, only 19.7 for the TBC made of the same material with conventionally desired structure.