The growth state of the thermally grown oxide (TGO) in thermal barrier coatings (TBC) has a crucial influence on the lifetime of TBC. Laser shock processing (LSP) is a new method for modifying the metallic bond layer. In this paper, NiAlHf coatings were modified through LSP. The effect of LSP on TGO formation in the early oxidation phase, the growth state of TGO at the long oxidation stage and the distribution of Hf element within the NiAlHf coatings after LSP were investigated. The results show that LSP successfully induce two effects on NiAlHf coatings. (1) The original oxide particles on the coatings surface are smaller and distribute more densely after LSP. In the oxidation process, these smaller and denser particles act as nucleation points, which make it easier for them to grow rapidly into a continuous oxide film. (2) LSP introduces high density dislocation lines, dislocation cells, sub-grain boundaries and other crystal defects, which provides more short diffusion channels for the selective oxidation of Al element and promotes the growth of oxide films. Both of these effects promote the rapid formation of a dense, continuous and homogeneous oxide film during the early oxidation stages. In addition, Hf element in the No-LSP samples mainly precipitate along the NiAl grain boundaries during the long-time oxidation process. This tends to cause the accumulation of Hf-rich oxides and accelerates the cracking of the oxide film. In contrast, LSP-induced crystal defects allow Hf-rich oxides uniformly distribute within the coatings. The uniform distribution of Hf-rich oxides is beneficial for improving the oxidation resistance of TGO films.