Laser cladding has unique advantages in improving the wear resistance of materials or workpiece surfaces. CeOsub.2 could play a role in promoting the flow of the molten pool and grain refinement during the laser cladding process, which is likely to further improve the wear resistance of the coating. In this work, CeOsub.2 was introduced into the MgAlsub.2Osub.4/Fe-based laser cladding coating on the surface of GCr15 steel. The effects of the CeOsub.2 content on the phase composition, microstructure, hardness, and wear resistance of the coatings were also systematically investigated. The results showed that the addition of CeOsub.2 enhanced the continuity of the coating and reduced the size of the MgAlsub.2Osub.4 particles, which was associated with the addition of CeOsub.2’s intensification of the melt pool flow. The metal grain size reduced and then increased as the CeOsub.2 content increased, whereas the hardness and wear resistance of the MgAlsub.2Osub.4/Fe-based coatings increased and then decreased. Compared with the MgAlsub.2Osub.4/Fe-based coating without CeOsub.2, the hardness of the MgAlsub.2Osub.4/Fe-based coating with 1.0 wt% CeOsub.2 increased by 10% and the wear rate decreased by 40%, which was attributed to the metal grain refinement and particle dispersion strengthening.