Nanocomposite coatings of Cr–Si3N4 exhibiting low friction and high toughness were prepared on plasma nitrided AISI M2 steel substrates using an unbalanced magnetron sputtering system. The surface morphology and cross-sectional microstructure of the Cr–Si3N4 nanocomposite coatings were studied using field emission scanning electron microscopy (FESEM) techniques. Cr–Si3N4 nanocomposite coatings prepared at 48 at.% Cr exhibited a dense microstructure with nanoindentation hardness and toughness values of 18 GPa and 2.0 MPam½, respectively. Nanoscratch measurements indicated that Cr–Si3N4 nanocomposite coatings exhibited good adhesion with a maximum critical load of 150 mN. Ball-on-disc reciprocating tests at a load of 2 N showed that Cr–Si3N4 nanocomposite coatings prepared at 48 at.% Cr exhibited an average friction coefficient of 0.30. FESEM studies of the wear tracks indicated that there was no significant wear loss and the Cr–Si3N4 nanocomposite coatings exhibited only mild wear due to oxidation.