NiTi shape memory alloy (NiTi SMA) has been widely used for many medical applications such as dental and orthopaedic implants. Laser gas nitriding is one of the most effective methods to improve the surface performance of NiTi SMA. Laser gas nitrided layer was fabricated on the surface of NiTi SMA after irradiated by a continuous wave Nd:YAG laser in N2 environment. With optimum process parameters, a compact laser modified surface MMC coating reinforced with fine TiN was achieved. There was a layer of TiN ceramics on the top of modification layer, with a thickness of 1～2 μm. Then the amount of TiN reinforcement gradually decreases across the coating. Morphology and composition and biological activities were individually investigated by using scanning electron microscopy (SEM), energy dispersive X-ray spectroscopy (EDX), experiment of the immersed in simulated body fluid (SBF) at 37 ℃. The results indicated that there was a good metallurgical bonding between the hard modification layer and the NiTi alloy substrate. Laser gas nitriding can effectively improve the ability of NiTi SMA to induce the formation of bone-like apatite in vitro environment.