A trend in sintered machine parts is the production of net shaped objects and comprex shaped parts. Correspondingly the machinability of green compacts with a lathe was investigated experimentally. In this regard, the compactibility of a raw powder was also discussed. Beside Fe-40% Cu plated powder with excellent compactibility, Fe-40%Cu, Fe-3%Cu, Fe-3%Cu-1%C and Fe-1%C as mixed powders and Fe powder were used. All these green strengths increase in proportion to the compacting pressure in the range of 98MPa to 686MPa. As the results of cutting test, satisfactory cutting surfaces were obtained for the green compacts with the radial crushing strength above about 60 MPa. Furthermore, the graphite as one of the alloying elements serves to provide lubrication on cutting. Conseqently, both Fe-3%Cu-1%C and Fe-1%C compacts exhibit good machinability in spite of low green strength in comparison with the others.