Three kinds of hypereutectic Fe-Cr-C hardfacing coatings were designed to research the refinement effect and heterogeneous nucleation mechanism of NbC on nano-Y2O3 in the coatings. The microstructure and elemental maps of Fe-Cr-C-Nb-Y2O3 coating were investigated by field emission scanning electron microscope. The phase structures of the coating and heterogeneous nucleation were researched by transmission electron microscope (TEM). The lattice mismatch between Y2O3 and NbC was computed by Bramfitt's two-dimensional lattice mismatch theory. The adhesive strength, interface energy and electronic properties of Y2O3(111)/NbC(110) interfaces were calculated by a first-principles method. The bonding characteristics of heterogeneous nucleation interfaces were analyzed by charge density difference, electron localization function and Bader charge population. The experimental results show that the primary M7C3 can be refined by NbC, when Nb additive was added into the Fe-Cr-C coating. When nano-Y2O3 and Nb additive were added into the coating simultaneously, the primary M7C3 can be further refined. The SEM results show that NbC can be effective heterogeneous nucleation substrate of the primary M7C3 and there is a compound containing rare earth (RE) element Y in NbC particle. The TEM results verified the RE compound in NbC particle is Y2O3, and they combine together tightly. The calculation results indicate that the two-dimensional lattice mismatch of Y2O3(111)/NbC(110) interface is 6.8%, which reveals that Y2O3 meets the geometric condition to act as a medium-effective heterogeneous nucleation substrate of NbC. In all interface models, the adhesive strength of O-Bridge model is the largest (W-ad=9.75J/m(2)) and its stability is the best (gamma=-0.87J/m(2)). The major bond type of O-terminated interfaces is covalent one. Actually, the interfacial energy of O-terminated interface is negative, which reveals that their formation process is a process of energy reduction and structure stabilization. It means Y2O3 and NbC can form stable interface structure. It can be predicted that the heterogeneous nucleation occurs preferably on the O-terminated interfaces. Therefore, Y2O3 can serve as an effective heterogeneous nucleation substrate of NbC to refine it.