The mechanics of chip segmentation, during machining of a cold rolled steel has been investigated from a phenomenological point of view using a high speed movie camera and an explosive quick stop device. The latter was used for obtaining chip root samples at various stages of segmentation for subsequent examination in the Optical and Scanning Electron Microscope (SEM). The chip segmentation process is found to arise as a result of instabilities in the cutting process and is further augmented by the dynamic response of part of the machine tool structure. This process involves a slow forward movement of the plastic boundary in the primary shear zone forming a ramp on the free surface of the chip followed by a rapid return of the plastic boundary back towards the tool forming a step on the chip segment as a result of partial fracture at the free surface. This process is characterized by large strains, low shear angles that oscillate cyclically and stick-slip friction on the rake face. The instability in the cutting process is proposed to be due to the negative stress—strain characteristics of certain materials at large strains, as Walker and Shaw [1] proposed, involving void formation around second phase particles, their propagation into microcracks in the primary shear zone and coalescence of these cracks leading to partial fracture. Evidence for this has been obtained in this investigation.