&ggr;‐Fe2O3powder of acicular shape was modified by reaction with Co2+and Fe2+ion containing solution or Co(OH)2to obtain a cobalt ferrite layer of various cobalt content on the surface of each particle. It was found that this epitaxial Co‐doping raised the coercivity of &ggr;‐Fe2O3from 420 (Oe) to 770 (Oe). The coercivity of such epitaxial Co‐doped &ggr;‐Fe2O3powders depends on the packing density in the same manner as the acicularly shaped &ggr;‐Fe2O3powder. The dependence of the coercivity of the powders on temperature, the chemical composition and preparation technique were also studied. The effective uniaxial anisotropy constants were measured. The shapes of the powders were observed by electron microscopy. On the basis of these studies, we are of the opinion that the development of a surface anisotropy of the epitaxial layer is the most probable cause of the increasing coercivity.