Cutting edge plays an important role in generating machined surface. In order to consider the geometric effects of the cutting edge on mechanical states, the concept of ploughing force and stagnation point was introduced which explains the generating mechanism of machined surface during cutting. The effects of edge radius and nose radius of cutting tool on the distribution of residual stresses of the machined surface having several hardness were studied. Good machined surface having high compressive residual surface stresses can be achieved if cutting tools having large edge radius and small nose radius are used for cutting work materials having high hardness with high depth of cut. The magnitude of edge radius and the hardness of work material also affected the shape of the chip in orthogonal cutting.