The liquid film damping is one of the main technology for the aerospace, navigation, and machine tool. However, the research on the fine boring is very limited. The paper set up the fine boring squeezed liquid film damped system of multi degree of freedom vibration simulation model and solve mathematical model by transfer matrix theory. The damping coefficient for the fine boring system can be obtained. The mechanical device of liquid film damping system is established. 20# machine oil, 40# machine oil, and cutting fluid are used to the system. The tests indicate that the effect of liquid film formed by cutting fluid is better than oil film formed by machine oil in the static test, but oil film formed by machine oil is better than liquid film formed by cutting fluid in the effect of dynamic test. The simulation model has high accuracy to reliability. The simulation model can directly obtain the optimal parameters, so as to provide effective way to guide field processing.