The cutting process of the affected layer is simulated by FEM and the influence of cutting sequence on residual stress and strain are discussed in this report. The residual stress and strain after machining in the workpiece are affected by the flow stress characteristic of the workpiece and the cutting conditions, like tool geometry and cutting speed. In addition, the affected layer by previous cutting is usually cut again in the following cutting process. Cutting of the affected layer causes the change of cutting forces or shear angle. Thus the residual stress and strain are affected by the cutting sequence, too. In the cutting sequence from roughing to finishing, the residual stress might be changed by each cutting sequence. In case of the rough machining of an annealed workpiece, the tensile residual stress is generated in the cutting direction within the machined surface. The fine machining following the rough machining causes the compressive residual stress on the surface. Repetition of the fine machining, however, does not cause the compressive residual stress any more. According to these results the residual stress level might be controlled by the optimization of machining process.