This paper presents a machine vision–based precise tool positioning and verification system that may be used with milling and lathe machines, and so on. For many industrial applications, the accuracy required in machining operations is of the order of microns. The developed machine vision–based tool position verification process involves pixel calibration to compute and measure real-world minute dimensions. These measurements are based on two-dimensional spatial correlation of sequential images captured from the movement of the tool with a resolution of 250 µm. The captured sequential images are thresholded using a new bio-inspired technique named Negative Selection Algorithm, a model of Artificial Immune System. The developed system extracts the difference between the actual and target positions of the tool from the captured images through image processing and calculates the error. To compensate for the positional error, alignment commands are fed to the two-axis high precision motor. The maximum error observed was ±206 µm for 14.99999 mm movement.