Machining tools are subjected to various physical stresses as well as oxidation and other chemical affronts. As a result, nearly 40 % of cutting tools made in Europe are now covered with a protective coating. However, the cost of coating is relatively high and is passed on to the consumer. In addition, performance and endurance of coated cutting tools are still insufficient and limit potential applications of the tools. The ‘Nano-composite machining tools with wear and thermal resistance’ (Restool) project was initiated to develop new coating materials and coating processes to increase wear protection of coated tools, thus reducing costs and enhancing competitiveness of European small and medium-sized enterprises (SMEs) working in the manufacturing sector. Researchers selected nano-composites based on the titanium nitride/silicon nitride family (nc-TiN/SiNx) for evaluation. The scientists optimised synthesis of the composites with a focus on wear resistance as well as thermal and mechanical properties. They then developed the coating technology to optimise adhesive strength, thickness and surface topography for chemical and mechanical stability. Finally, performance and lifetime of coated tools compared to conventional tools was evaluated. The nc-TiN/SiNx nano-composite coatings were extremely hard and demonstrated excellent thermal stability as well, providing an alternative to conventional coating technology. Commercial exploitation of the enhanced wear and thermal resistance coatings has the potential to significantly reduce costs related to machine failures and downtime for numerous SMEs involved in manufacturing.