Carbon fiber reinforced plastics (CFRP) are widely used in the aeronautic aerospace and manufacturing industries due to their excellent performance. However, Due to the structural characteristics of CFRP, its processing efficiency is low, the surface quality is poor, and it is easy to cause tool wear. In this study, the effect of tool type (conventional milling tool, rhombus tooth milling tool, electroplating mill-grinding tool, slotted mill-grinding tool, laser trimmed milling-grinding tool) and processing parameters (spindle speed, feeding speed, radial cutting depth) on tool life, processing quality and accuracy was systematically studied. The cutting force of the three types of electroplated diamond mill-grinding tools and the surface roughness of the processed CFRP are smaller than that of the conventional milling tool, and larger than that of the rhombus tooth milling tool. The main cutting and radial force of the trimming mill-grinding tool is 9.5 N, 1.26 N, respectively. The surface roughness is about 2.524 µm. Due to the laser trimmed mill-grinding tool has neat and sharp edges which can shear carbon fiber effectively, there is no obvious burrs on the processed CFRP. Moreover, the processed surface roughness was significantly reduced, and only slight wear of the tool was occurred. More importantly, since the processing debris can easily flow out of the straight groove of the laser trimmed mill-grinding tool, resulting in a sharp edge of the tool, which would reduce the cutting force. The overall processing performance of the laser trimmed mill-grinding tool is close to that of CFRP special tool (rhombus tooth milling tool), but its price is about one-fiftenth that of special tools. Therefore, the electroplated diamond milling tool with improved structure and optimized processing parameters can be an ideal tool for mill-grinding CFRP.