Abrasive water jet machining (AWJM) is one of the unique unconventional machining processes. It is used widely in aerospace and shipbuilding industry for machining hard to cut materials besides it allows the structural characteristics of the specimen to remain unaltered even after machining. In this study, the effects of process parameters on machining of DMR249A steel by AWJM were studied. DMR249A is a military grade high strength low alloy steel used for ship construction and repairs. For machining input parameters are taken as pressure (P), stand-off distance (SOD) and abrasive flow rate (AFR) while the traverse speed is kept constant, Taguchi design of experiment (DOE) approach is used. L27 orthogonal array is selected for experimental work. Influence of process parameters on material removal rate, surface roughness and kerf angle was studied. Optimum process parameters are identified with the help of grey's relational analysis. From the optimum value obtained confirmation tests are done with pressure of 165.472 MPa, SOD 4 mm and AFR 406 g/min. After optimisation, the influence of machining parameter outcomes was examined through analysis of variance. It was noted that pressure had a significant effect and a contribution of 21.34% and combination of pressure and AFR had a contribution of 45.41%. To confirm the effectiveness of grey relational analysis scanning electron microscopic image is taken to study the morphology and surface structure. From the analysis the optimised parameter has less abrasive particle embedment and also fine surface finish was observed.