The paper aims at demonstrating various microstructures which can be obtained using the suspension spraying technique and their respective significance in enhancing the thermal insulation property of a thermal barrier coating. Three different types of coating microstructures are discussed which were produced by the Axial Suspension Plasma Spraying. Detailed characterization of coatings was then performed. Optical and scanning electron microscopy were utilized for microstructure evaluations; x-ray diffraction for phase analysis; water impregnation, image analysis, and mercury intrusion porosimetry for porosity analysis, and laser flash analysis for thermal diffusivity measurements were used. The results showed that Axial Suspension Plasma Spraying can generate vertically cracked, porous, and feathery columnar-type microstructures. Pore size distribution was found in micron, submicron, and nanometer range. Higher overall porosity, the lower density of vertical cracks or inter-column spacing, and higher inter-pass porosity favored thermal insulation property of the coating. Significant increase in thermal diffusivity and conductivity was found at higher temperature, which is believed to be due to the pore rearrangement (sintering and pore coarsening). Thermal conductivity values for these coatings were also compared with electron beam physical vapor deposition (EBPVD) thermal barrier coatings from the literature and found to be much lower.