The properties of wear-resistant TiN coatings on steel substrates were studied after variation in the deposition parameters-the pressure, substrate bias and discharge power. X-ray techniques were used to determine the residual stress on several planes by the sin2 psi method. Deposition of films with various compressive stress levels ranging from -4000 to -100 MPa was possible, but scanning electron microscopy examinations indicate that the film morphology was influenced simultaneously. Hardness measurements and scratch tests were performed to monitor the mechanical properties. The critical loads in the scratch test proved to be very dependent on the stress level, whereas the hardness was observed to decrease when the films had an open columnar morphology with coarse grains. Neither of these testing methods could be used to predict the tribological behaviour of the coated cutting tools used in a milling machine, because the performance of the tools is determined by both the stress and the structure. The wear resistance was optimal when moderate bias voltages were used, whereas at low bias voltages the film morphology is not compact, and at high bias voltages the wear resistance was affected by the high compressive stresses.