A　method　for　crack-free　machining　of　deep　cavity　in　alumina　is　demonstrated　using　a　low-cost　CO2　continuous　wave　(CW)　laser.　CO2　laser　underwater　machining　has　been　found　to　result　in　reducing　substrate　defects　such　as　recast　layer,　dross,　cracking　and　heat　damages　that　are　typically　found　in　machining　in　air.　Finite　Element　(FE)　modelling　technique　and　Smooth　Particle　Hydrodynamic　(SPH)　modelling　technique　were　employed　to　understand　the　effect　of　water　on　crack　resistance　and　debris　removal　during　underwater　machining.　Also　the　microstructures　of　machined　region　were　demonstrated　to　reveal　different　heating　and　cooling　processes　during　laser　machining　in　water　and　in　air.　The　experimental　results　indicated　that　the　machined　kerf　width　was　strongly　affected　by　the　water　layer　thickness,　whereas　the　kerf　depth　was　controlled　by　both　the　laser　pass　number　and　water　layer　thickness.　The　optimal　average　machining　rate　was　up　to　2.95　mm(3)/min　at　a　60W　laser　power.　(C)　2011　Elsevier　Ltd.　All　rights　reserved.