In a collaborative project between the USDA and Northern Illinois University, the use of ethanol corn processing by-products as bio-filler materials in the compression molding of phenolic plastics has been studied. This paper reports on the results of a machinability study in the milling of various grades of this material. Three types of samples were studied: 100%, 75% and 50% phenolic samples. The milling operation was carried out with a fixed depth of cut of 2.0 mm using a 12.5 mm diameter two-fluted end-mill. The cutting speed was varied between 120 and 160 m/min at feeds between 200 and 300 mm/min. Surface roughness measurements were taken after each combination of feed and speed. Mathematical models for surface roughness have been developed in terms of speed and feed at constant depth of cut by response surface methodology (RSM); the significance of the speed and feed on the surface roughness has been established with Analysis of Variance (ANOVA) for the three types of samples. The optimum cutting conditions were obtained by constructing contours of constant surface roughness using MINITAB statistical software.