Thin hard coatings on components and tools are used increasingly due to the rapid development in deposition techniques, tribological performance and application skills. The residual stresses in a coated surface are crucial for its tribological performance. Compressive residual stresses in PVD deposited TiN and DLC coatings were measured to be in the range of 0.03–4 GPa on steel substrate and 0.1–1.3 GPa on silicon. MoS2 coatings had tensional stresses in the range of 0.8–1.3 on steel and 0.16 GPa compressive stresses on silicon. The fracture pattern of coatings deposited on steel substrate were analysed both in bend testing and scratch testing. A micro-scale finite element method (FEM) modelling and stress simulation of a 2 μm TiN-coated steel surface was carried out and showed a reduction of the generated tensile buckling stresses in front of the sliding tip when compressive residual stresses of 1 GPa were included in the model. However, this reduction is not similarly observed in the scratch groove behind the tip, possibly due to sliding contact-induced stress relaxation. Scratch and bending tests allowed calculation of the fracture toughness of the three coated surfaces, based on both empirical crack pattern observations and FEM stress calculation, which resulted in highest values for TiN coating followed by MoS2 and DLC coatings, being KC = 4–11, about 2, and 1–2 MPa m1/2, respectively. Higher compressive residual stresses in the coating and higher elastic modulus of the coating correlated to increased fracture toughness of the coated surface.