This research investigated the effects of various cobalt and nickel/cobalt additions to P/M 304L stainless steel on oxidation behavior at 900 °C, hardness and bending strength. A single action press at 498 MPa was used for compacting powder mixture specimens. They were then sintered at 1300 °C for 30 minutes in hydrogen atmosphere and heat treated at 900 °C for 2, 5, 10, 20, 25, 40, 60, 80 and 100 hours in air for oxidation tests. It is clearly shown in the results that cobalt addition could improve density, hardness and bending strength. However, only 1 wt.-% Co addition was the best condition for oxidation resistance. The detrimental effect of Ni addition dominated the beneficial effect of Co addition, because its bigger powder size led to more pore formation. The resulting mechanical properties and oxidation behaviour depend on microstructures, porosity and powder size.