• The oxidation resistance of (γ’+β) two-phase NiAlDy alloy is optimized by LSP. • LSP reduces scale growth rate due to its impact on initial oxidation behavior. • LSP promotes θ-α transition by increasing dislocation density and surface roughness. • LSP leads to distinction in oxide scale morphology on both the γ’ and β phase. • LSP facilitates the formation of large Al 2 O 3 particles (2–3 μm) on the β phase. (γ’+β) two-phase Ni-Al is a promising high-temperature protective coating material used on Ni-base superalloys since it has good interfacial compatibility with superalloys due to the low Al content compared to single-phase β-NiAl. In this paper, we aim to improve the oxidation resistance, whereby Ni-34Al-0.1Dy, a (γ’+β) two-phase Ni-Al alloy, was treated by laser shock processing (LSP) and the oxidation behavior at 1150 °C was investigated. The results showed that after oxidation, Al 2 O 3 scale formed on the original β phase of the untreated alloy with a small grain size (200–800 nm), while for the LSP-treated samples, the scale grown on the original β phase was dominantly composed of larger Al 2 O 3 grains with a size of 2–3 μm. The distinction was attributed to the promotion of θ-Al 2 O 3 to α-Al 2 O 3 transformation induced by the LSP, because the dislocation density, as well as surface roughness, were increased during LSP treatment which can provide heterogeneous nucleation sites for α-Al 2 O 3 . In addition, the larger-size Al 2 O 3 particles, derived from the direct conversion of needle-like θ-Al 2 O 3 in the initial oxidation stage, could rapidly overspread the whole β phase surface thus reducing the scale growth rate.