Electroformed diamond tools have been used for many years in grinding and cutting fields while electrodeposited diamond composite coatings have been widely studied due to their desirable hardness, wear and corrosion resistance. This article eports the detrimental impact of diamond magnetism on the composites microstructure and gives explanations. Microstructure differences between composites that, respectively, contained no - further - treated diamond, magnetism - strengthening treated diamond and magnetism weakening treated diamond were carefully observed. It is shown that diamond magnetization treatment drastically harms the composite microstructure (e. G. , roughening the coating surface, coarsening the matrix grain, and more seriously, reducing the mechanical retention of diamond grains in the matrix) while demagnetization treatment does the opposite. All the observed facts could be explained by the electromagnetic interaction between magnetic fields produced by magnetic diamond grains and electric current (moving cations) during the electrodeposition process.