In an embodiment, a coated tool is disclosed. The coated tool includes a base material, a first layer on the base material, and a second layer coated on the first layer. The first layer contains diamond crystals therein and has a first mean crystal size. The second layer contains diamond crystals therein and has a second mean crystal size that is smaller than the first mean crystal size. The first and the second layers contain hydrogen, and have a first hydrogen content and a second hydrogen content respectively. The second hydrogen content is larger than the first hydrogen content.