In this study, the effect of diamond interlayer on the tribological properties of titanium aluminum nitride (TiAlN) film sliding against medium carbon steel is investigated in dry rotary friction tests, by evaluating the coefficients of friction (COFs), wear rates, worn surfaces and element transitions of the contacted surfaces in the cemented carbide (WC-Co)-steel, TiAlN-steel, microcrystalline diamond (MCD)-steel, TiAlN/MCD-steel, micro- and nano-crystalline diamond (MNCD)-steel and TiAlN/MNCD-steel contacting pairs. It is found that compared with the TiAlN monolayer, the TiAlN/MCD bilayer film shows 57% higher COF, while the COF of TiAlN/MNCD multilayer inversely drops as much as 54%, due to the distinguished surface diamond grain morphologies of the MCD and MNCD interlayers as well as the copied effect of the TiAlN layer with relatively small thickness. Meanwhile, the diamond interlayer can provide robust load support for the top TiAlN layer, induce the wear mechanism transform from the abrasive wear to adhesive wear, and result in the mild wear of TiAlN/MCD and TiAlN/MNCD multilayers compared to the TiAlN monolayer. Moreover, the softer TiAlN top layer on MCD and MNCD interlayers can effectively improve the storage capacity of element oxygen and worn steel ball debris as well as accelerating the surface chemical reactions to form a smoother continuous ionic metal oxides tribofilm in the contacted zones due to its good self-lubricating property. Among all the hard coatings discussed when sliding against medium carbon steel, the TiAlN/MNCD coating shows the lowest COF and mild wear, due to the robust load support capacity of the beneath MNCD layer as well as the good self-lubricated and tribofilm formation capacity of the top TiAlN layer, which shows broad application potential in carbon steel machining.