Electroless Co-doped sensors with good coverage were prepared to investigate their microstructure variation. The phases of the deposited electrodes were identified to be Ni and beta-Ni(OH)(2), respectively. Scanning electron microscopy was employed to observe the morphology evolution for various values of deposition time. According to the peak intensity of the energy dispersive spectrum and the composition change of the deposited film, the growth phenomena of the deposited film were obtained. A hardball model was constructed to describe the microstructure variation of this electrode. Nevertheless, this model was utilized to deduce the ethanol sensing mechanism. It was found that the response current for the ethanol was mainly contributed from that of beta/beta rather than alpha/gamma and its sensitivity depended on the competition between the g phase and beta phase. Besides, the deterioration of the stability for sensitivity resulted from the decay in the phase ratio of the beta-NiOOH to gamma-NiOOH during charging.