Oxidation resistance is a key issue in the gamma TiAl alloy to be used at elevated temperature air environment. In the present study, effect of Y addition on the oxidation resistance of Ti-46.6Al-1.4Mn-2Mo alloy was investigated. Preparation of the experimental alloy was according to the elemental powder metallurgy (EPM), which consisted of blending elemental powders, compaction and hot extrusion. A fully lamellar microstructure was obtained by heat treatment. With Y-addition the microstructure, in terms of the grain size and the lamellar thickness, was greatly refined. The beneficial effect of Y-addition was most apparent in the oxidation resistance in air at 800degreesC. The enhanced oxidation resistance was attributed to two factors, reduction of the internal oxygen and formation of multi-scale, Y-containing oxide film retarding penetration of external oxygen in the air environment.