This paper presents the prediction of cutting forces and chatter stability of micro-milling operations from the material's constitutive flow stress and structural dynamics of the micro-end mill. The cutting force coefficients are identified either using previously presented slip-line field or finite element methods by considering the effects of chip size, cutting edge radius, rake angle and cutting speed. The process damping caused by the plowing of round edge is modeled by finite element method. The frequency response function of the fragile micro-mill is measured through specially devised piezo actuator mechanism. Dynamic model of micro-milling with the velocity dependent process damping mechanism is presented, and the chatter stability is predicted in frequency domain. The proposed models have been experimentally verified in micro-milling of AISI 1045 steel.