The machining process on be considered as a planned interaction of the workpiece, the tool and the machine tool. In an unmanned situation, the results of this interaction are to be continuously monitored so that any changes in the machining environment on be sensed to corrective actions. In order to design the process monitoring system for unmanned manufacturing, the identification of chip formation is proposed. The system proposes the method of using acoustic emission(AE) signal analysis to identify the chip formation during cutting.