A CVD (Chemical Vapor Deposition) diamond coated tungsten carbide (WC) and cobalt (Co) sintered alloy punch was trimmed by the femtosecond laser machining to sharpen its edge with about 2 μm and to simultaneously make nanostructuring to its side surface. In addition to the sharpened edge, its edge profile was formed to be homogeneous enough to reduce the damage layer width by piercing the electrical amorphous steel sheet stack. Each brittle sheet in the stacked work was damaged to have three kinds of defects by piercing; e.g., the droop-like cracking in the thickness and at the vicinity of hole, the wrinkling in peak-to-valley with partial cracking on the peaks, and the circumferential cracking. When using the WC (Co) punch with the inhomogeneous edge profile in the sharpened edge width, these three damages were induced into each sheet and the maximum damage width exceeded 80 μm. When using the punch with the sharpened edge and homogeneous edge profile, the wrinkling mode was saved and the total affected layer width was significantly reduced to less than 20 μm. Through the precise embossing experiments, this effect of punch edge profile condition to the induced damages was discussed with a statement on the nanostructuring effect on the reduction of damaged width in electrical amorphous steel sheets. The developed tool with the sharpened edge and homogenous edge condition contributes to the realization of a low iron loss motor with a reduced affected layer width.