Metal matrix composites (MMCs) have been found to possess tremendous prospective engineering applications that require materials offering a combination of lightweight with considerably enhanced mechanical and physical properties. However, the applications of MMCs are limited by their poor machinability which is a result of their highly abrasive nature that causes excessive wear to the cutting tools. In this study, an investigation into the mechanism of the tool wear in cutting of MMCs is carried out. It is found that during cutting of an MMC, the tool cutting edge will impact on the reinforcement particles. The impacted particles will then either be dislodged from the matrix, doing no harm to the tool, or be embedded into the matrix, ploughing on the tool flank and causing excessive tool flank wear. According to this tool wear mechanism, a pressured steam jet approach is developed for the minimization of the tool wear by preventing the impacted reinforcement particles from being embedded in the workpiece matrix. Experimental tests for cutting of SiC–aluminum MMC using cubic boron nitride (KB-90) and polycrystalline diamond (KP-300) tool inserts with the aid of the pressured steam jet are conducted. The results show that from full factorial design of experiments the effect of the pressured steam jet plays a significant role on the tool wear followed by tool inserts and depth of cut. The working mechanism of the pressured steam jet method and the experimental testing results are discussed in detail.