Direct cutting tests was carried out to evaluate the dynamic performance of lathes under various cutting conditions. Significant factors influencing the chatter limits were identified through use of analysis of variance. Dynamic performances of two lathes were compared and the merits and drawbacks of the direct cutting test were discussed. Exciting-direct-cutting test method was newly proposed as a more rational method of dynamic performance test. The basic theory and experiments of the test were explained. The results shows that the method can be used as a powerful tool for the evaluation and the improvement of dynamic performance of machine tools.