Microstructural changes, damage initiation and spallation Of a production TBC, which consists of: an electron beam physical vapor deposited ZrO2-7 wt.% Y2O3 (YSZ); thermally grown oxide (TGO); MCrAlY bond coat; and a polycrystalline IN-738 superalloy substrate, were examined as a function of thermal cycles at 1121 degreesC. Thermal cycling for TBC specimens in air consisted of a 10-min heat-up, a 40-min hold at 1121 degreesC and a 10-min quench. Microstructural characterization was carried out by: photo-stimulated luminescence piezo-spectroscopy (PLPS), X-ray diffraction (XRD). scanning electron microscopy (SEM); and energy dispersive spectroscopy (EDS). Development of microstructure in the YSZ coatings, growth of the thermally grown oxide (TGO) and its constituents. and phase transformations in the MCrAlY bond coat were examined as a function of thermal cycles. Instability of the TGO/bond coat interface (i.e. rumpling), leading to localized cracking at the YSZ/TGO interface and within the YSZ, was observed after as few as five thermal cycles. Spallation of YSZ coatings occurred after approximately 400 cycles. Significant void formation at the TGO/bond coat interface and formation of a Ni/Co rich oxides at the TGO/bond coat interface due to rapid internal oxidation of Al-depleted MCrAlY bond coat were strong contributors to spallation failure of the TBC. The final spallation of TBC results from a 'link-up' of damage at the TGO/bond coat interface with the rumpling-induced micro-cracking at the YSZ/TGO interface. (C) 2001 Elsevier Science B.V. All rights reserved.