Surface-modified zirconium (Zr)-based alloys, mainly by fabricating protective coatings, are being developed and evaluated as accident-tolerant fuel (ATF) claddings, aiming to improve fuel reliability and safety during normal operations, anticipated operational occurrences, and accident scenarios in water-cooled reactors. In this overview, the performance of Zr alloy claddings under normal and accident conditions is first briefly summarized. In evaluating previous studies, various coating concepts are highlighted based on coating materials, focusing on their performance in autoclave hydrothermal corrosion tests and high-temperature steam oxidation tests. The challenges for the utilization of coatings, including materials selection, deposition technology, and stability under various situations, are discussed to provide some valuable guidance to future research activities.