Vibrations in machine tools make many problems in precision, production efficiency, and machine performance. The relative vibration between a workpiece and a tool is very complicated due to many sources. In this study, the dynamic characteristics of a newly developed CNC lathe were analyzed and its chatter characteristics were predicted by a chatter analysis method using finite element analysis and 3 dimensional cutting dynamics. The simulated results showed very complex characteristics of chatter vibration and the borderline of limiting depth of cut was used as the stability limit. To check the validity of this method, cutting tests were done in the CNC lathe using a boring bar as a tool because boring process is very weak due to long overhang . The experimental results showed that the simplified borderline was to be considered as limiting depth of cut at which the chatter vibration starts and the stability limits depended on various cutting parameters such as cutting speed, feed and nose radius of tool.