Combining arc ion plating and magnetron sputtering to achieve alternate deposition on the nanoscale can avoid the inherent drawback of individual deposition technique and broaden the selection of materials. Additionally, the compositionally modulated nano-multilayer structure can combine different constituents’ features and synergistically improve the hardness and toughness. On this basis, a new generation of high-performance tool coatings can be expected. The paper briefly reviews the development history of hybrid arc/sputtering deposition. The early Arc Bond Sputtering technology realizes automatic switching between arc-evaporation and sputtering modes of the same target by virtue of the multifunctional cathode arc source and combines the advantages of different deposition technologies. The relevant research progress of hybrid tool coatings in academia and industry is summarized, including high-hardness nanocomposite coatings prepared by hybrid arc/sputtering, a wider range of target materials by using magnetron sputtering, the alternating deposition of arc layer and sputtering layer to fabricate nano-multilayer tool coatings with friction adaptability, coating design based on the transition from the bottom arc support layer to the top amorphous functional layer, interruption to the continuous growth of columnar crystals of arc layers using the amorphous layers deposited by high-power pulsed magnetron sputtering, such as SiBCN and TiB2, which gives coatings dense microstructure and excellent high-temperature properties. Besides, the study on the properties of hybrid AlTiN and AlTiN/AlCrN coatings is also reported. Finally, the status of the development and application of domestic hybrid deposition tool coatings and the unresolved scientific problems are summarized and expected.