In this work, the impact of pattern edge of MgO films due to electrode separation process on its electrical reliability was investigated by measuring and analyzing I–V and time-dependent dielectric breakdown (TDDB) characteristics of MgO films with different pattern edge length. The measured TDDB lifetime at 63% drastically decreased from 1440 to 2 s when the pattern edge length increased from 32 to 320 μm, thus the electric reliability of MgO films can be significantly degraded due to the pattern edge. It was found that this issue can be solved by improving the process condition of ion bean etching (IBE), by turning the IBE angle and the IBE angle divergence. These findings can lead to high reliability magnetic tunnel junction fabrication in spin-transfer torque magnetic random access memory.