The growing fight against infections caused by bacteria poses new challenges for development of materials and medical devices with antimicrobial properties. Silver is a well known antimicrobial agent and has recently started to be used in nanoparticulate form, with the advantage of a high specific surface area and a continuous release of enough concentration of silver ions/radicals. The synthesis of MgO-Ag nanocomposite coatings by in situ deposition of silver nanoparticles during plasma electrolytic oxidation of a magnesium substrate is presented in this study. The process was performed in an electrolyte containing Ag nanoparticles under different oxidation conditions (i.e., current density, oxidizing time, silver nanoparticles concentration in the electrolyte). Surface morphology, phase composition and elemental composition (on the surface and across the thickness of MgO-Ag nanocomposite coatings) were assessed by scanning electron microscopy, X-ray diffraction, energy X-ray dispersive spectrometry and radio frequency glow discharge optical emission spectroscopy, respectively. The coatings were found to be porous, around 7 mum thick, consisting of a crystalline oxide matrix embedded with silver nanoparticles. The findings suggest that plasma electrolytic oxidation process has potential for the synthesis of MgO-Ag nanocomposite coatings.