Soft magnetic powder cores are made by pressurizing and molding pure iron powder covered with insulation film. The material is used as a component of electro-magnetic converter parts essential for automobiles, home electric appliances and electronic equipment. The material permits downsizing and higher performance of such equipment. The recent severer requirements for performance and dimensional accuracy need a new processing technology that warrants the required level of both magnetic performance and surface quality of the material. However in general, processing - grinding - soft magnetic powder cores can give rise to degradation of magnetic performance and/or chipping or plucking of the ground surface due to the mechanical damage of the insulation film and/or loss of structural particles from the material due to the increase in grinding resistance. The authors performed basic studies for various grinding conditions and wheels that could possibly affect the quality of the material with a view to eliminating these problems. As a result, factors that affect the surface quality were identified, and a method that warrants a higher surface quality was proposed.