This paper presents a novel methodology of using cutting fluids to improve the material removal process in metal cutting. To this end, a set of orthogonal cutting experiments are conducted using various cutting fluids to calculate the chip shrinkage coefficient in the material removal process. Chip shrinkage coefficient has been focused on as an important factor that affects chip formation in the material removal process. Using cutting fluids under the influence of a static magnetic field in the metal cutting process is proposed as an innovative method to decrease the deformation that is emerged in the chip formation process while cutting cylindrical parts in lathes. Experiments showed that the application of cutting fluids under the influence of a static magnetic field decreased the shrinkage of the chip by up to 20 % in comparison to the conventional use of cutting fluids in turning cylindrical parts with HSS tools. Moreover, a mathematical model of the effect of boiling point and density of cutting fluids on tool flank wear has been developed in this paper. The obtained results present that the magnetized cutting fluids have an improved cooling capacity and they can be used as a modern cutting fluid in manufacturing. Cutting fluid Chip shrinkage Metal cutting Magnetic field Turning