In this study, we prepared yttria stabilized zirconia granules for thermal barrier coatings using a spray drying process. First, we characterized the properties of granules such as flow rate and packing density for utilizing the air plasma spray process. The flow rate and packing density data showed 0.732 g/sec and 2.14 $g/cm^3$, respectively, when we used larger and denser particles, which are better than hollow granules or smaller spherical granules. Second, we chose larger, spherical granules fabricated in alcohol solvent as starting powders and sprayed it on the bondcoat/nimonic alloy by an atmospheric plasma spray process varying the process parameters, the feeding rate, gun speed and spray distance. Finally, we evaluated representative thermal and mechanical characteristics. The thermal expansion coefficients of the coatings were $11{sim}12.7{ imes}10^{-6}/^{circ}C$ and the indentation stress measured was 2.5 GPa at 0.15 of indentation strain.