Controlling material degradation in complex mechanobiological environments is the current challenge in advancing biodegradable magnesium implants for orthopaedic applications. Understanding stress corrosion cracking (SCC) mechanisms of magnesium alloy-coating systems in physiological fluids facilitates the design of magnesium implants with excellent biomedical performance. In this study, we investigated the SCC behaviour of a medical grade PEO-coated magnesium alloy WE43 under different loading conditions. Constant loadings tests (CLT) and slow strain rate tests (SSRT) were conducted to evaluate the SCC susceptibility of this alloy-coating system under in vitro conditions. Fracture surfaces of the non-coated and PEO-coated specimens were characterised by scanning electron microscopy to reveal the SCC mechanisms under different loading configurations. The experimental results showed that the alloy-coating system exhibits a high SCC resistance in SSRT conditions. However, high stress levels and plastic deformations lead to a significant acceleration of the SCC process. Moreover, the fracture surface analysis demonstrated that the brittle nature of the PEO coating deteriorates the mechanical integrity of the alloy under critical mechanical loadings, which results in an increased susceptibility towards stress corrosion cracking of the coated WE43. Display omitted •Stress corrosion cracking behaviour of PEO-coated rare-earth containing Mg alloy.•Sterile corrosion cell design for in vitro experiments under mechanical loadings.•Constant load testing reveals critical stress level of 80 % Rm for SCC.•Slow strain rate tests reveal significant material embrittlement.•PEO coating turns from protective to deteriorative under high stresses.