Machining hardened steels has become an important manufacturing process, particularly in the automotive and bearing industries. Hardened steel GCr15 with its harness between HRC50 and HRC65 is one kind of more difficult machining material. Abrasive processes such as grinding have typically been required to machine hardened steels, but advances in machine tools and a new cutting material of polycrystalline cubic boron nitride (PCBN) have allowed hard turning on modern lathes to seems to gain an ever increasing industrial acceptance as an economically and environmentally friendly alternative to many grinding applications. In this paper, based on large deformation theory and updated Lagrangian procedure, a coupled thermo-mechanical plane strain orthogonal precision cutting model with general finite element analysis software is developed to the influence of cutting edge preparation on the cutting of GCr15 with PCBN tool, such as cutting forces, shear angle, and cutting temperature. The three major designs of cutting edge preparation are used on most commercial cutting inserts: a) sharp edge, b) honed edge, and c) chamfer edge. The friction between the tool and the chip is assumed to follow a shear model and the local adaptive remeshing technique is used for the formation of chip. The calculated principle cutting forces are compared with published data and found to be in good agreement. The simulation results can be used as a practical tool both by researchers and toolmakers to design new tools with rational tool edge and to optimize the cutting process.