The groove rolling is a process that transforms the bloom or billet into a shape with circular section through a series of rolling. Inhibition of surface defect generation in groove rolling is a matter of great importance and therefore many research groups proposed a lot of models to find the location of surface defect initiation. In this study, we propose a model for maximum shear stress ratio over equivalent strain to catch the location of surface defect onset. This model is coupled with element removing method and applied to box groove rolling of POSCO No.3 Rod Mill. Results show that proposed model in this study can find the location of surface defect initiation during groove rolling when finite element analysis results is compared with experiments. The proposed criterion has been applied successfully to design roll grooves which inhibit the generation of surface defect.