This paper reports the effects of surface preparation, drill stresses, and edge rounding effects due to diamond coating on the performance of tungsten carbide drills in machining of a high strength, abrasive composite. The surface of the drills were treated for cobalt removal prior to coating. Scanning electron microscopy and x-ray diffractions were performed on the drills before and after the treatment and coating processes. Uncoated and coated drills were used in drilling holes in an aluminum oxide composite, and forces and torques were measured during the process. The drilling tests indicated that the coating process resulted in reduced tool life with catastrophic tool failure likely due to edge rounding effects and irregularities being introduced in the vicinity of the cutting edge.