Commercial 316 LVM austenitic stainless steel samples have been coated by immersion in a bath of molten Al-12.6%Si alloy for 120 s. The coating consists of the Al(12)(Fe,Cr)(3)Si(2) intermetallic. In vitro corrosion behaviour has been evaluated in the Ringer's solution by means of potentiodynamic curves and electrochemical impedance spectroscopy. The results reveal that the coated specimens exhibit lower susceptibility to localised corrosion with respect to the substrate. XPS analysis suggests that the ennoblement of the pitting potential is due to the formation of a chromium oxyhydroxide containing passive layer. The intermetallic coating shows a good biocompatibility, as demonstrated by culturing human mesenchymal stem cells isolated from bone marrow which attached, grew and differentiated to the osteoblastic lineage to a similar extent on coated and bare steels. In summary, this study proposes a method that generates Ni-free coatings of the stainless steel with useful properties for biomedical applications.