The machinability tests were conducted by using a YD-21 dynamometer on a CA6161A lathe. The experiments, conducted to determine the effect of free-cutting additives on machining characteristics of austenitic stainless steels, are presented. The results have shown that machinable inclusions were composed of MnS and CuO, and they might be also Ti4C2S2. The presence of Bi in the inclusion was detected by the atom map and electro-probe microanalysis (EPMA), which might be the most important factor to improve the machinability of austenitic stainless steels. The cutting forces for steel B were lower than those of steel A at various cutting speeds; the abrasion depth of the flank of the tool for steel B was less than that of the steel A in the case of the same cutting conditions. The machinability of austenitic stainless steel was visibly improved by adding free-cutting additives, such as sulfur, copper and bismuth, etc. Ultimate tensile, yield strength, and total elongation values of the free cutting austenitic stainless steel reach a satisfactory effect due to the addition of these free-cutting additives.