Hard chromium coatings electrodeposited are highly valued in multiple industries for their excellent mechanical characteristics and resistance to corrosion. The general process for preparing these coatings includes Cr6+ and Cr3+ process, the Cr6+ process is highly toxic and strictly regulated. The Cr3+ process is less hazardous but can produce coatings with defects. We propose an alternative process of electroplating nanocrystalline CrAl alloy coating with high hardness by using anhydrous Cr2+ electrolyte. The impact of current density on mechanical properties (i.e., hardness H, elastic modulus E, fracture toughness H/E and resistance to plastic deformation H3/E2) and coating defects has been systematically investigated. As current density increases from 1 mA/cm2 to 5 mA/cm2, the coating surface morphology changes from polyhedral to nodular clusters with grain size decreasing from a few microns to several nanometers. The nanoindentation test was performed on the cross-section of the coating. The nanohardness H of the coating reaches a high of 8.26 GPa, attributed to both solid solution strengthening and grain refinement. A significant decrease in elastic modulus E of the coating compared to bulk Cr is observed and can be explained by the grain boundary mediated process and a grain coalescence model. High values H/E and H3/E2 indicate improved fracture toughness and resistance to plastic deformation of the coating. As current density exceeding 5 mA/cm2, laminar cracks develop due to co-deposition of CrCl2 particles. This is attributed to the electrolyte acidity transition, caused by depletion of Al2Cl7− at the interface. This work provides a deeper understanding of the microstructural evolution, mechanical properties and defects of CrAl alloy coatings and also provides a new method to fabricate high-quality coatings with enhanced properties. The defect-free coatings achieved in this study have great potential for practical applications in various fields such as tribological and corrosion resistance coatings.