Abstract: Cu₆₂Fe₃₈ composite coating was produced on Q235 steel substrate with the SW-500 Nd-YAG low-power pulsed laser. The microstructure of the coating was analyzed by OM, SEM, and EDS. Moreover, the mechanism of liquid phase separation was investigated. The results show that liquid phase separation occurs during the rapid solidification process of Cu₆₂Fe₃₈ alloy. A large number of Fe-rich spherical particles are embedded in the Cu-rich matrix. At the top of the coating, the spherical particles evenly distribute. However, at the bottom of coating, some larger spherical particles are embedded in Cu-rich matrix and many fine Cu-rich grains are precipitated inside the larger Fe-rich spherical particles. Some dendritic microstructure appears in the center of coating.