Machining of titanium is quite difficult and expensive. Heat generated in the process of cutting does not dissipate quickly, which affects tool life. In the last decade ultra fine grained (UFG) titanium has emerged as an option for substitution for more expensive titanium alloys. Extreme grain refinement can be readily performed by severe plastic deformation techniques. Grain refinement of a material achieved in this way was shown to change its mechanical and physical properties. In the present study, the microstructure evolution and the shear band formation in chips of coarse grained and UFG titanium machined to three different depths and three different feeding rates was investigated. A change in thermal characteristics of commercial purity Ti with grain refinement was studied by comparing heating/cooling measurements with an analytical solution of the heat transfer boundary problem. It was demonstrated that an improvement in the machinability can be expected for UFG titanium.