Atmospheric plasma spray (APS) deposition of a high-performance anode coating, which is essential for obtaining high power density from a solid oxide fuel cell (SOFC), is developed. A conventional, micron-sized, nickel-coated graphite - yttria stabilized zirconia (YSZ) - graphite blend feedstock leads to a non-uniform layered coating microstructure due to the difference in the physical and thermo-physical properties of the components. In this research, new types of feedstock material received from a spray-drying method, which includes nano-components of NiO and YSZ (300 nm), are used. The microstructure and mechanical properties of a coating containing a nano composite that is prepared from spray-dried powders are evaluated and compared with those of a coating prepared from blended powder feedstock. The coating microstructures are characterized for uniformity, mechanical properties and electrical conductivity. The coatings prepared from spray-dried powders are better as they provide larger three-phase boundaries for hydrogen oxidation and are expected to have lower polarization losses in SOFC anode applications than those of coatings prepared from blended feedstock. (C) 2007 Elsevier B.V. All rights reserved.