Development of advanced industries such as nuclear, aerospace and medicine and demands for high precision parts with high quality surfaces, necessitate using of non-traditional finishing method. Magnetic abrasive finishing method is one of the modern processes which use magnetic forces to erode the material from the surfaces in the nano scale. In this method the abrasive particles are pressed on the surfaces due to the magnet forces while the relative motion between workpiece and the magnets make the finishing possible. This process is used for those specimens which can not be finished using traditional method. Another modern method of chipping is ultrasonic assisted machining. In the last decades after developments in the field of controlling the ultrasonic waves, the researchers pay more attention to ultrasonic assisted machining processes. Also advent of advanced materials with special quality and the competitive industries has motivated scientists to merge modern processes. In the present research the basis theory of abrasive finishing and ultrasonic chipping has been studied, firstly. By providing some new ideas and doing some primary projects, the combination of two modern machining methods has become possible. The magnetic abrasive finishing method was used for removing recast layer of wire electrical discharge machined specimens. The recast layer may be full of craters and microcracks which reduce service life of materials. In the second primary project a new magnetic tool was fabricated and assembled on the CNC lath machine for finishing the inner complex surface of workpieces. Furthoremore in the third primary project by combination of ultrasonic vibration and chemical machining, the surface quality was improved and the effective parameters were analysed. Experimental results proved that etch assisted ultrasonic floating abrasion eliminates the recast layer completely and leaves a finished surface without any crack or microcracks on surface. In this thesis two modern machining and finishing method, magnetic abrasive finishing and ultrasonic machining, were combined. Therefore for the first time by design and fabrication of a new mechanism with the ultrasonic vibrated tool surrounded by abrasive particles in the waterlogged environment, the surface quality was improved. Using the design of experiments method, full factorial technique, 32×22 tests were conducted and the results were taken. For analyzing the effect of input parameters the analysis of variance method was used. The results proved the advantages of the proposed method in comparison with traditional ones. Microscopic photoes and 3D surface profiles present the surface improvement and the benefits of new mechanism. Key words: Abrasive finishing, Magnetic field, Ultrasonic vibration, Design of experiments, Analysis of variance