Characteristics of internal microstructures have a strong impact on the properties of particulate reinforced metal composites. In the present work, we perform finite element simulations to elucidate fundamental mechanisms involved in the ultra-precision orthogonal cutting of aluminum-based silicon carbide composites (SiCp/Al), with an emphasis on the influence of particle distribution characteristic. The SiCp/Al composite with a particle volume fraction of 25 vol% and a mean particle size of 10 μm consists of randomly distributed polygon-shaped SiC particles, the elastic deformation and brittle failure of which are described by the brittle cracking model. Simulation results reveal that in addition to metal matrix tearing, cutting-induced particle deformation in terms of dislodging, debonding, and cracking plays an important role in the microscopic deformation and correlated machining force variation and machined surface integrity. It is found that the standard deviation of particle size to the mean value has a strong influence on the machinability of microscopic particle–tool edge interactions and macroscopically observed machining results. The present work provides a guideline for the rational synthesis of particulate-reinforced metal composites with high machinability.