Fabrication of miniaturized components provides a challenge to the manufacturing industries and to meet the challenges many unconventional machining methods are developed, among which laser beam micromachining (LBμM) is one. But, thermal effects such as recast layer, heat-affected zone (HAZ), debris, and thermal cracks are commonly observed in LBμM. So, in order to minimize the thermal effects, underwater laser beam micromachining (UW-LBμM) came into existence. In this paper, experiment on UW-LBμM is reported using a Q-switched Nd:YAG laser for fabricating microchannels on 304 stainless steel. The effect of input process parameters (scanning speed, number of scan, laser pulse energy) on output responses (kerf width, kerf depth, surface roughness) of microchannel is studied. Laser micromachined channels are characterized by using optical microscopy, surface profilometer, scanning electron microscopy, and energy dispersive X-ray spectroscopy. It is observed that the dimensions of kerf width and kerf depth are low at lower number of scan, laser pulse energy, and higher scanning speed. The surface roughness decreases with decrease in number of scan and increase in laser pulse energy. Minimum surface roughness is achieved at scanning speed of 300 μm/s. The recast layer and debris are minimum during UW-LBμM compared to LBμM. Elemental comparison is carried out inside and in the surroundings of microchannel.