Electrochemical discharge machining (ECDM) process utilizes the spark discharge produced by gas film formation during electrolysis. In conventional ECDM process precise control of the spark generation is difficult because of the randomness of gas film formation which results in the significant deterioration of process qualities such as excessive overcut, poor machining accuracy and low machining repeatability. The undesirable overcut phenomenon strictly hinders the dimensional miniaturization of ECDM process especially when the diameter of applied tool is much smaller than 100 urn. In this study a side insulated tool and dilute electrolyte concentration is proposed to reduce the undesirable overcut and thus, to improve the machining resolution of ECDM process. Experiments are conducted with various machining parameters, such as spark ignition voltage, electrolyte concentration and tool insulation. As a result the feasibility of miniaturization in ECDM process is successfully improved by reducing the excessive overcut phenomena.