Considerable research has been conducted over recent decades on the role of non-metallic inclusions and their link to the machinability of different steels. The present work reviews the mechanisms of steel fractures during different mechanical machining operations and the behavior of various non-metallic inclusions in a cutting zone. More specifically, the effects of composition, size, number and morphology of inclusions on machinability factors (such as cutting tool wear, power consumption, etc.) are discussed and summarized. Finally, some methods for modification of non-metallic inclusions in the liquid steel are considered to obtain a desired balance between mechanical properties and machinability of various steel grades.