Recently, metal matrix composites (MMCs) reinforced with nano-particles receive increasing attention from academia and industries. The cutting mechanism of nano MMCs is believed to be different when compared to composites reinforced with micro particles. This paper presents cutting mechanism comparison between SiC/Al metal matrix composites (MMCs) reinforced with micro and nano-particles using finite element method. The cutting mechanisms are investigated in terms of the von Mises stress distribution, tool-particles interaction, chip formation mechanism and surface morphology. It is found that the particles in nano size remained intact without fracture during the cutting process and are more likely to produce continuous chips, while the particles in micro size are easy to break and tend to form discontinues chips. Better machined surface quality with less defects can be obtained from nano size reinforced MMCs compared with their micro size counterparts. The model validation was carried out by conducting machining experiments on two types of MMCs and good agreements are found with the simulation results.