A galvanic method to deposit chitosan coatings on stainless steel substrate is reported. Deposition of suitable coatings is desired to improve biocompatibility and corrosion resistance of metallic medical devices to be implanted in human body. In the present work, a thin hydrogel layer of chitosan was deposited on 304SS by a galvanic displacement reaction, which is advantageous first as it does not require external power supply. 304SS was immersed into an aqueous solution of chitosan/lactic acid and electrochemically coupled with magnesium acting as a sacrificial anode. SEM images showed the formation of a uniform layer of chitosan with a thickness controlled by deposition time. Corrosion tests in simulating body fluid showed that chitosan coatings shift the corrosion potential of 304 substrates toward nobler values. Finally, the cytotoxicity of the coating was investigated through cell viability assays with osteoblastic cell MC3T3-E1. The results revealed highly satisfying biocompatibility of the coating.