Abstract: Medium Density Fiber board (MDF) panels are appropriate for many exterior and interior industrial applications. The degree of surface roughness of MDF plays an important role since, any surface irregularities will affect the final quality of the product. In the present study, regression model were developed to predict surface roughness in drilling MDF panels with carbide step drills. In the development of predictive models, drilling parameters of spindle speed, feed rate and drill diameter were considered as model variables. For this purpose, Taguchi’s design of experiments was carried out in order to collect surface roughness value. The Orthogonal Array (OA) and Analysis of Variance (ANOVA) are employed to study the surface roughness characteristics in drilling operation of MDF panels. The objective is to establish a correlation between spindle speed, feed rate and drill diameter with surface roughness in a MDF panel. The experiments are conducted as per Taguchi L27 orthogonal array with different cutting conditions. ANOVA and F-test were used to check the validity of regression model and to determine the significant parameter affecting the surface roughness. The statistical analysis showed that the feed rate was an utmost parameter on surface roughness. The microstructure of drilled surfaces were also studied by scanning electron microscopy (SEM).The SEM investigations reveled that drilling MDF panels with step drill produce surface striations and waviness which were increased significantly with feed rate.