The influence of oxygen content on the properties of cathodic arc-deposited AlCr(OxN1-x) coatings has been studied. All samples were prepared in a nitrogen-rich mixture of N-2 and O-2 at 550 degrees C using lateral rotating arc cathodes (LARC) technology together with a pulsed bias voltage. The obtained coatings were characterized by various techniques including XRD, EPMA, TEM, pin-on-disk wear tests and nanoindentation. The results obtained allow to classify the coatings into three groups with respect to their microstructure, mechanical properties and oxygen content, x. For the first group of samples with x <= 0.6, single-phase films of (Al,Cr) OxN1-x with fcc lattice were obtained, with well-developed columnar structure and a hardness of 30 to 33 GPa. In the second group, a diffuse columnar structure was observed while the fcc lattice was still present despite the large proportion of oxygen, 0.60.97, where a well-crystalline alpha-(Al,Cr)(2)O-3 corundum phase was observed and the hardness increased again to 28 GPa. Our results indicate that the second group of coatings is metastable and after heat treatment transforms to a composite of cubic oxynitride and corundum oxide. Both friction and wear of samples from the entire investigated compositional range were studied at room temperature and 600 degrees C. The low wear rates observed for the oxynitride coatings underline their potential for use in turning and milling applications. (C) 2011 Elsevier B.V. All rights reserved.