AL6061 alloys are high-potential materials for many manufacturing sectors including automobiles, aerospace, electrical, military, sports and engineering components, owing to their better technological properties. Through the thermal erosion process of Electrical Discharge Machining (EDM), an electrically-produced spark vaporizes materials that are electrically conductive. This study examines the viability of improvement of material removal rate in the micro-electric discharge machining of AL6061 alloy using Fe2O3 nano-powder-mixed dielectric fluid. For the purpose of this research, a copper electrode with 500?m diameter and positive polarity was used. The performance measures of the machining process were investigated regarding the material removal rate (MRR). one concentration of nano-powder were added to dielectric (4g/l). Results showed that if Iron oxide nano-powders (Fe2O3) exists in the dielectric, MRR can be significantly improved.