In the present work, nanocomposite Mo-B-C coatings were deposited on high speed steel and hard metal substrates by magnetron sputtering of three targets. These coatings were subjected to annealing to final temperatures in the range from 500 °C to 1000 °C. It was found that the as deposited Mo-B-C coatings exhibited hardness of ~20 GPa, nanocomposite microstructure with very fine grains (~2 nm) and low degree of crystallinity. The X-ray diffraction and transmission electron microscopy together with selective area electron diffraction were used to study the temperature induced changes of the micro-structure of the coating and its crystallinity. The annealing process significantly improved the hardness (from ~20 GPa to ~30 GPa) and effective elastic modulus (from initial 330 GPa -500 GPa) of coatings while their resistance to fracture was kept sufficiently high.