In this study, Mg-2wt% Zn scaffolds were fabricated by powder metallurgy method and the effects of the porosity content on the microstructure and the mechanical properties of the scaffolds were studied. The nano hydroxyapatite-chitosan (nHA-CS) coatings were developed using pulse electro deposition (PED) method to improve corrosion resistance and biocompatibility of scaffolds in the solution body fluids (SBF). The effect of PED parameters (voltage and time) and nHA/CS ratio were studied to achieve optimal nanocomposite coating. The results showed that optimal coating was obtained at voltage 40 V, 10 minutes of coating time and nHA/CS ratio =10. The pulse-peak current density (CD), the pulse duty cycles (DC), pH and temperature for the fabrication of the coatings were conducted at 10 mA cm-2, 0.2 ,7 and 37oC, respectively. In optimal coating, the nHA atomic ratio was obtained Ca/P=1.57, similar to the value of bone hydroxyapatite. The in vitro biocompatibility of the optimal coating was evaluated by cell adhesion, cytotoxicity and alkaline phosphatase (ALP) assays using MG63 cells. The results indicate that the optimal nanocomposite coating was highly biocompatible, making this material more suitable for applications in bone tissue engineering and to repair bone defects caused by sports injuries.