Abstract The catalytic performance of core-shell platinum alloy nanoparticles is typically superior to that of pure platinum nanoparticles for the oxygen reduction reaction in fuel cell cathodes. Thorough understanding of core-shell formation is critical for atomic-scale design and control of the platinum shell, which is known to be the structural feature responsible for the enhancement. Here we reveal details of a counter-intuitive core-shell formation process in platinum-cobalt nanoparticles at elevated temperature under oxygen at atmospheric pressure, by using advanced in situ electron microscopy. Initial segregation of a thin platinum, rather than cobalt oxide, surface layer occurs concurrently with ordering of the intermetallic core, followed by the layer-by-layer growth of a platinum shell via Ostwald ripening during the oxygen annealing treatment. Calculations based on density functional theory demonstrate that this process follows an energetically favourable path. These findings are expected to be useful for the future design of structured platinum alloy nanocatalysts.