It is difficult to obtain low residual stress and high hardness after laser cladding M2 powder coating on the surface of 20 steel at the same time. In this paper, the finite element model of piston rod and coating was established. Different preheating temperatures were set in piston rod. The variation laws of the residual stress and hardness were investigated. The results show that the residual stress and hardness are affected by their cooling rate. The cooling rate and the residual stress are decreased by preheating process, and it also has a significant effect on the coating hardness. With the increase of preheating temperature, the radial and axial residual stress of the piston rod and coating are decreased. Compared with the non-preheating process, the hardness of the coating basically does not change and the lower hardness of the fusion zone when the preheating temperature is 300-475 ℃. The hardness of coating and fusion zone is decreased significantly when the preheating temperature is 500 ℃. When the preheating temperature is 475 ℃ and the same environment temperature is 20 ℃, the maximum radial residual stress decreases by 39.8%, the maximum axial residual stress decreases by 42.1%, and the coating hardness basically does not change with comparison of the non-preheating process. It is helpful to reduce the coating residual stress and obtain high hardness coating by preheating the piston rod to 475 ℃ temperature before laser cladding.