The influence of laser surface alloying (LSA) with niobium (Nb) on the corrosion and mechanical properties of Zircaloy-4 was examined by potentiodynamic polarization testing in a chloride solution at 80 degrees C and microhardness testing. The results are discussed with the structural and compositional variations in the LSA layer determined by X-ray diffraction (XRD), a scanning electron microscope (SEM) and a wavelength dispersive spectrometer (WDS). The LSA on Zircaloy-4 precoated with Nb produced a Nb-alloyed layer 200 similar to 300 mu m thick with 1.3 similar to 2.5 wt.% Nb, depending on the laser beam power. The alloyed layer was composed of a mixed structure of alpha-Zr and beta-Zr phases with the beta-Zr phase increasing with the Nb content in the alloyed layer. The LSA with Nb increased the microhardness of Zircaloy-4, which was attributed primarily to the grain-size refinement of rapid cooling and, also, to the solid solution hardening with Nh. The resistance to the localized corrosion of Zircaloy-4, in a chloride solution significantly improved through LSA with Nb, which was attributed to the combined effects of the fine rapidly cooled microstructure and to the Nb alloying.