Cobalt coatings on metal hydrides give rise to an additional capacity due to the cobalt on the surface of the alloy. In such a case, the galvanostatic discharge technique cannot be used to measure the diffusion coefficient of hydrogen in the alloy. We present here an analytical impedance model of the metal hydride electrode. This simple model is used to calculate the diffusion coefficient of hydrogen in the metal alloy. The impedance response of cobalt microencapsulated LaNi4.27Sn0.24 electrode was measured at different hydrogen contents. From the slope of the Nyquist plot in the transition region the diffusion coefficient of hydrogen was calculated at various states of charge (SOC). It is seen that the diffusion coefficient increases with the hydrogen content in the alloy. The technique applied for cobalt encapsulated LaNi4.27Sn0.24 could however be used for any hydrogen storage alloy.