In this study, to accommodate higher interfacial shear stress between alumina coating system and metallic substrate, coating modulus and compressive stresses are graded from interface to 80 µm thickness. . The modulus gradient is achieved by varying Al to O ratio by tuning the oxygen flow and compressive stresses are varied from 0.1GPa to 2.5GPa by changing bias voltage during the reactive sputtering process. Static thermal fatigue life of coated samples were evaluated using simple heating and cooling cycles, significant change in microstructures and mechanical properties were observed. Room temperature high fatigue cycle (HCF) was evaluated using vibration testing and the coating fatigue life was evaluated as 2.0X106 cycles. Low cycle fatigue was evaluated using axial compressive and tensile mode and the coatings were cracked beyond 10,000 cycles. The Micro tensile testing revelled that modulus and compressive stress graded coatings are failed at 1.1% tensile strain and which is higher tensile load bearing capacity than the monolithic stoichiometric alumina coating. Hardness and modulus of the 80 µm thickness is 34GPa and 240 GPa. At higher strain coating started cracking and post-microscopy analysis shows variation of crack width at different zones of the tensile specimen. .