A composite Ni-based coating with diamond mass fraction of 10% was prepared on the surface of 65Mn steel by induction heating. The microstructure and phase composition of the brazing joint were analyzed by SEM, EPMA and XRD. The element diffusion mechanism and formation mechanism of diamond/filler interface in induction brazing were studied. The wear resistance of the coating was tested by dry sand rubber wheel wear tester, and the wear resistance enhancement mechanism of diamond/Ni-based coating was analyzed. The results show that the main phases of filler alloy in brazing coating are Ni4B3, (Ni, Fe) solid solution, Ni3Si2 and CrB. The diamond and the filler alloy react in metallurgy, and the distribution of C element at the interface of diamond/filler alloy causes the appearance of double layer carbide structure on diamond surface, which are Cr3C2 on diamond side and Cr7C3 on the surface of Cr3C2 respectively. The wear resistance of the diamond composite coating is significantly better than that of the steel substrate. The wear weight loss of the coating is only 0.25g in 60min, which is 1/12 of that of the steel contrast sample. Diamond plays a role in preventing furrow expansion during the wear process, and the failure mechanism of the coating is Ni-based alloy wear and diamond shedding.