An acoustic emission-based touch-off detection system has been developed to determine contact between a rotating microtool and a workpiece surface with micron-level accuracy. The system has been implemented on an existing three-axis microscale machine tool. The system has been tested with microendmills as small as in diameter and microdrills as small as in diameter. The accuracy of the system has been found to depend on tool geometry and workpiece surface characteristics and is generally on the order of . An analytical model has been constructed to predict touch-off detection error. The calibrated model has been shown to predict surface overshoot and undershoot trends quite well. Simulations have shown that touch-off error is dominated by part surface roughness.