Micro-milling is a precision manufacturing process with broad applications across the biomedical, electronics, aerospace, and aeronautical industries owing to its versatility, capability, economy, and efficiency in a wide range of materials. In particular, the micro-milling process is highly suitable for very precise and accurate machining of mold prototypes with high aspect ratios in the microdomain, as well as for rapid micro-texturing and micro-patterning, which will have great importance in the near future in bio-implant manufacturing. This is particularly true for machining of typical difficult-to-machine materials commonly found in both the mold and orthopedic implant industries. However, inherent physical process constraints of machining arise as macro-milling is scaled down to the microdomain. This leads to some physical phenomena during micro-milling such as chip formation, size effect, and process instabilities. These dynamic physical process phenomena are introduced and discussed in detail. It is important to remember that these phenomena have multifactor effects during micro-milling, which must be taken into consideration to maximize the performance of the process. The most recent research on the micro-milling process inputs is discussed in detail from a process output perspective to determine how the process as a whole can be improved. Additionally, newly developed processes that combine conventional micro-milling with other technologies, which have great prospects in reducing the issues related to the physical process phenomena, are also introduced. Finally, the major applications of this versatile precision machining process are discussed with important insights into how the application range may be further broadened.