Ultrasonically assisted turning (UAT) is a novel material-processing technology, where high frequency vibration (frequency f ≈ 20kHz, amplitude a ≈15μm) is superimposed on the movement of the cutting tool. Advantages of UAT have been demonstrated for a broad spectrum of applications. Compared to conventional turning (CT), this technique allows significant improvements in processing intractable materials, such as high-strength aerospace alloys, composites and ceramics. Superimposed ultrasonic vibration yields a noticeable decrease in cutting forces, as well as a superior surface finish. A vibro-impact interaction between the tool and workpiece in UAT in the process of continuous chip formation leads to a dynamically changing stress distribution in the process zone as compared to the quasistatic one in CT. The paper presents a three-dimensional, fully thermomechanically coupled computational model of UAT incorporating a non-linear elasto-plastic material model with strain-rate sensitivity and contact interaction with friction at the chip–tool interface. 3D stress distributions in the cutting region are analysed for a representative cycle of ultrasonic vibration. The dependence of various process parameters, such as shear stresses and cutting forces on vibration frequency and amplitude is also studied.