A finite element model of orthogonal metal cutting is described. The paper introduces a new chip separation criterion based on the effective plastic strain in the workpiece. Several cutting parameters that are often neglected in simplified metal-cutting models are included, such as elastic-plastic material properties of both the workpiece and tool, friction along the tool rake face, and geometry of the cutting edge and workpiece. The model predicts chip geometry, residual stresses in the workpiece, and tool stresses and forces, without any reliance on empirical metal cutting data. The paper demonstrates that use of a chip separation criterion based on effective plastic strain is essential in predicting chip geometry and residual stresses with the finite element method.