Laser-assisted machining (LAM) of silicon nitride (Si3N4) is evaluated for its potential to become an economically viable process in fabricating precision ceramic parts. On-line measurements of cutting force and workpiece temperature are performed, and tool wear and surface integrity are examined. Tool wear characteristics are determined as a function of workpiece temperature, which is measured on-line using a laser pyrometer. Tool wear/failure mechanisms are characterized using optical microscopy, while application of scanning electron microscopy to heated and machined surfaces, as well as to chips, is used to infer material removal mechanisms and the extent of damage caused by LAM. The sub-surface damage of parts produced by LAM is compared with that of typical ground parts.