A hydrothermal nanoparticle-plating technique has been employed in order to grow a layer of CoSb3 nanoparticles on the surface of La0.9CoFe3Sb12 bulk matrix grains. The nanoparticles have a typical size of 30–40 nm while the nano-layer can be up to several hundreds of nanometer thick. The nanoparticle layer, which resides at the grain boundary after hotpressing, provides an extra scattering channel for phonons, in addition to the “rattler” atoms (La), grain boundary scattering, and mass fluctuation mechanisms found within the bulk matrix grain. The electrical resistivity, thermopower, thermal conductivity, and Hall coefficient have been investigated as a function of temperature and the weight percentage (%) of nanoparticles. Largely due to the reduced lattice thermal conductivity, a ZT value of ∼0.5 is attained at 725 K on the sample with 5 wt % of nanoparticles showing a 15% improvement of the ZT from that of the sample without nanoparticles and comparable to the best value reported at this temperature.