An abradable coating composition for use on shrouds in gas turbine engines (or other hot gas path metal components exposed to high temperatures) containing an initial porous coating phase created by adding a “fugitive polymer” (such as polyester or polyimide) to the base metal alloy, together with a brittle intermetallic phase such as &bgr;-NiAl that serves to increase the brittle nature of the metal matrix, thereby increasing the abradability of the coating at elevated temperatures, and to improve the oxidation resistance of the coating at elevated temperatures. Coatings having about 12 wt % polyester has been found to exhibit excellent abradability for applications involving turbine shroud coatings. An abradable coating thickness in the range of between 40 and 60 ml provides the best performance for turbine shrouds exposed to gas temperatures between 1380° F. and 1850° F. Abradable coatings in accordance with the invention can be used for new metal components or to repair existing equipment.