Abstract This study investigates the properties and cutting performance with thin layers applied by two PVD technologies. PVD methods ARC and LARC were used for the deposition of thin coatings onto tools prepared by powder metallurgy (PM). Advanced types of layers - multilayer AlTiCrN and nanocomposite type of nc-AlTiN/Si3N4 layer - were analyzed by standard techniques for surface status and quality assessment – roughness, hardness, layer thickness, chemical composition by GDOES, tribological properties at room and elevated temperature. Durability testing of the cutting tools was carried out according to the standard ISO 3685-1999. The nanocompositenc-AlTiN/Si3N4 layer had lower roughness when compared to monolayer AlTiCrN which leads to higher hardness and better layer quality. The HV0.5 hardness values reached nearly 26 GPa. The results showed a two to three times longer durability of the cutting tools in comparison with equivalent uncoated PM and traditional materials. The deposited coatings contributed to the improvement of their durability.