The NiCrAlY-0·4 wt-%CeO2 coated superalloys were subjected to aggressive environment of 40%Na2SO4-60%V2O5 at 900uC under cyclic conditions for 100 cycles and weight gain was monitored after each cycle. Techniques like X-ray diffraction, field emission scanning electron microscopy with energy dispersive X-ray analysis and X-ray mapping were used to analyse the corrosion products. The NiCrAlY-0·4 wt-%CeO2 coated specimen showed negligible microspalling of the oxide scale. The incorporation of cerium oxide in NiCrAlY powder has contributed to the development of very high resistance to oxidation in the given molten salt environment. Other oxides formed were Cr2O3,Al2O3 and spinel of Ni and Cr which are highly protective at elevated temperature. CeO2 in the form of streaks present along the splat boundaries and possible formation of CeVO4 perhaps led to improved oxidation resistance. © 2010 Institute of Materials, Minerals and Mining.