Hard coatings on tool inserts are expected to enhance the tool-life and improve machining performance. Despite availability of a wide range of tool inserts with various hard coatings, very little scientific data seems to be available for quantitative understanding of the coating effects. A recent study undertaken at the University of Kentucky involves modeling and chip microstructure analysis. This paper presents the results of this study establishing the influence of multi-layer/composite tool coatings on the variation of tool-chip interface thermal/frictional conditions during orthogonal machining. In this work, two different types of tool coatings (TiCN-Al₂O₃-TiN, Al₂O₃-ZrO₂), each with different coating thicknesses (20 and 30 µm) and substrate materials (K313, K8735, KC9110, K420) were used to machine AISI 1045 steel. The variations in cutting forces, chip-forms/chip-breaking, tool-wear patterns and chip morphology were systematically analyzed and reported along with a microstructural/metallographic analysis of orthogonal chips produced under different coating conditions.