Abstract: Axial vibration drilling method can solve the problems of large drilling force, difficult chip breaking and high drilling temperature in the micro hole drilling process of difficult-to-cut materials. Based on the mechanism of axial vibration drilling, its kinematics and variable-thickness cutting characteristics were analyzed. In this paper, the finite element model of axial vibration drilling was established by using DEFORM-3D software, the axial vibration drilling and conventional drilling simulation tests of 304 stainless steel were carried out under the vibration frequency of 550 Hz, the amplitude of 16 μm, the speed of 3 000 r/min and the feed rate of 50 μm/r. The chip morphology, the axial force and torque in the two machining processes were compared and analyzed. The results show that compared with the conventional drilling, the axial vibration drilling has the better chip breaking effect, which can reduce the average axial force by about 48.1% and the average torque by about 38.2%.