The machining process of aluminum alloy usually produces built-up edge and tool sticking problems due to their low hardness and large plastic deformation, which may further affect the machined surface quality and tool life. This paper aims to investigate the influence of different cutting fluids on the machined surface quality and tool life during the milling process of 7050 aluminum alloy. A novel cutting fluid (QC-2803) was considered in the study, which is synthesized by addition of alkyl alcohol amide and chlorinated polyolefin, and the traditional cutting fluid (CCF-10) was used as the control group. The physical and chemical properties of two cutting fluids were characterized. The milling process of 7050 aluminum alloy was carried out under two different cutting fluid conditions. The machined surface morphology, cutting force and tool wear morphology were observed during the process. Results show that the surface tension of the novel cutting fluid is significantly lower than that of the traditional cutting fluid, which makes it easier to produce a lubricating film between the aluminum alloy and tool, and further benefits the machined surface quality and tool life. As a result, the surface roughness and cutting force are reduced by ~20.0% and ~42.9%, respectively, and the tool life is increased by 25.6% in the case of the novel cutting fluid (QC-2803). The results in this paper revealed the important laws of cutting fluid with metal surface quality, cutting performance and tool wear, which helps to control the machined surface quality and tool life by the selection of cutting fluid during metal milling.