This paper presents smart tooling concepts applied to ultraprecision machining, particularly through the development of smart tool holders, two types of smart cutting tools, and a smart spindle for high-speed drilling and precision turning purposes, respectively. The smart cutting tools presented are force-based devices, which allow measuring the cutting force in real-time. By monitoring the cutting force, a suitable sensor feedback signal can be captured, which can then be applied for the smart machining. Furthermore, an overview of recent research projects on smart spindle development is provided, demonstrating that signal feedback is very closely correlated to the drilling through a multilayer composite board. Implementation aspects on the proposed smart cutting tool are also explored in the application of hybrid dissimilar material machining.