Electroless nickel composite coatings containing luminescent particles have potential application as indicator coatings and for product authentication. In this paper, composite coatings containing europium doped yttrium vanadate has been prepared. The effects of various parameters, such as concentration of suspension of luminescent particles in bath solution, temperature and pH on the incorporation of YVO₄:Eu^3. into the nickel matrix have been studied. The conditions for optimum incorporation were bath loading of 15 g dm 3 at 90 °C and pH 5. 4. When viewed under UV light of wavelength 254 nm. bright red luminescence was observed for coating prepared under different operating conditions and the intensity increased with increased volume percent incorporation. The corrosion protection characteristic of Ni-P coating was lost due to the presence of luminescent particles. Microhardness remained almost unchanged while the surface roughness increased with the extent of particle incorporation. Optical microscopy of the surface and cross-section of coating revealed an increased density of particle distribution with bath loading. Composite Ni-P coating containing as little as 5.16% (vlv) of YVO₄:Eu^3.can be successfully used as an indicator undercoat belVeen the substrate and the functional coating.