Chemically precipitated β-type nickel hydroxide powder was surface-modified by electroless deposition of Co-Zn coatings,and physical properties of both the modified and unmodified nickel hydroxide were characterized by scanning electron microscopy (SEM), specific surface area (BET), X-ray diffraction (XRD) and X-ray photoelectron spectroscopy (XPS). It has been found that Co and Zn components of the surface electroless coatings exist in the oxidized state. Electrochemical performances of pasted nickel electrodes using the modified nickel hydroxide as an active material were investigated, and compared with those of the electrodes prepared with the unmodified nickel hydroxide. Charge/discharge tests show that the modified nickel hydroxide electrodes exhibit better performances in the charge efficiency, specific discharge capacity and active material utilization. Their resistance to swelling with cycling is also superior to that of the unmodified nickel hydroxide electrodes. Cyclic voltammetric (CV) studies indicate that the modified electrodes have a higher electrochemical activity, and the porous pasted nickel electrodes have some distinguished CV characteristics in comparison with those of the thin film nickel electrodes.