ZrB2-based composite coatings have broad application prospects in hypersonic aircraft, rockets, and re-entry spacecraft. However, poor toughness of the ZrB2 coating is an important problem to be solved urgently. This study designed and prepared ZrO2–B4C–Al precursor and nano-ZrB2-based composite coating were prepared in situ by reactive plasma spraying. The obtained toughness values of coating by plasma spraying ZrO2–B4C–Al powder increased by 241% in comparison with the coating by plasma spraying ZrB2–ZrC–Al2O3 powder. The coupling action of the toughening mechanism such as fine-grain strengthening, toughening crack deflection, and crack bridging greatly improved the toughness of the coating. This paper provides a novel idea for the preparation of high-properties nano-ZrB2 based composite coatings.Graphical abstract