Polycrystalline diamond (PCD) is an ideal tool material for machining high-pressure laminated (HPL) flooring with ceramics overlay. In this paper, the finite element (FE) model of PCD cutter was built firstly, then stress distribution of PCD cutter for machining wear resistance layer embedded with Al2O3 particles was analyzed. The analysis results showed that the stress distribution was variable in rake and flank face of tool, which leads to the final uneven wear profile. Moreover, the test of cutting load was carried out. From the analysis and test, it was shown that PCD cutter was suffering from the fatigue loading of high cycling while machining. At last, a series machining experiments was conducted and the wear characteristics were examined. The analysis results were verified by the wear characteristics of PCD tool. Machining experiments also revealed that the typical micro crack in wear region had great effects on the wear of tool.