In this work, plasma-sprayed nanostructured zirconia coatings stabilized with 3 mol.% yttria (3Y-TZP) were deposited on Ti substrates. The microstructure and phase composition of coatings were characterized using scanning electron microscopy and X-ray diffraction. The in vitro bioactivity of coatings was evaluated by examining the formation of bone-like apatite on its surface in simulated body fluid. MG63 cell lines were cultured on the coating to investigate its cytocompatibility. The crystalline phase of the as-sprayed coating was tetragonal zirconia, and no monoclinic zirconia was detected. The size of the grains on the as-sprayed coating surface was less than 100 nm. The apatite could precipitate on the surface of the coating immersed in simulated body fluid for 28 days while no apatite was formed on the surface of 3Y-TZP ceramic control, indicating that the bioactivity of the coating is superior to the ceramic with the same composition. It also revealed that the polished coating whose nanostructural outmost layer was removed was bioinert, implying the significance of the nanosized grains for its bioactivity. MG63 cells could adhere, grow and proliferate well on the coating surface, indicating that the coating had good cytocompatibility. Phase stability of plasma-sprayed 3Y-TZP coating was evaluated under hydrothermal conditions at 134 Β°C. It revealed that the plasma-sprayed nanostructured zirconia coating was more sensitive to aging than that of zirconia ceramics.