Spalling of nitralloy (balance Fe, 0.42% C, 0.55% Mn, 0.3% Si, 1.6% Cr, and 1.0% Al) during grinding has been studied. It was found that excess nitrogen which diffused into the alpha-Fe lattice during a two-step nitriding process was responsible for making the alloy surface brittle. This caused the spalling of the allay during a subsequent machining operation. Practically feasible ways to avoid this problem have been discussed.