The effect of martensitic phase transformation on cavitation erosion resistance for a deposited layer prepared from a Fe-8Cr- C-1.5Al-Ti flux-cored wire of metastable steel was studied. A reference material of AISI 316L stainless steel was used as a substrate. Cavitation tests were performed using a modified ultrasonic tester. X-ray diffraction was used to examine the phase transformation before and after cavitation tests. Also; the eroded surfaces of specimens were investigated by optical microscope (OM); scanning electron microscope (SEM); and 3D optical profilometer. The cavitation results revealed that the deposited layer exhibited a resistance to cavitation erosion approximately 10 times higher than the AISI 316L steel due to the γ ? martensitic phase transformation occurring during the cavitation process. The phase transformation plays a main role to minimize the cavitation damage of specimen. This is due to the fact that it contributes to obstructing movement of dislocations and increasing the hardness as a result of the increased hardening on the surface.