Austempered Ductile Iron (ADI) is a modified Spheroidal Graphite Iron (SGI) produced by applying a two-stage heat treatment cycle of austenitising and austempering. The microstructure of ADI also known as “ausferrite” consists of ferrite, austenite and graphite nodules. Machining ADI using conventional techniques is often problematic due to the microstructural phase transformation from austenite to martensite. Machining trials consisted of drilling ADI-Grades900, 1050, 1200 and 1400 using inserted (TiAlN PVD coated) type drills. The cutting parameters selected were; cutting speeds [m/min] of 30 and 40; penetration rates [mm/rev] of 0.1 and 0.2; to a constant depth of 20mm. The machining characteristics of ADI are evaluated through surface texture analysis and microhardness analysis. These results indicate that microhardness is modified during machining and surface texture is improved using a cutting fluid.