The aluminum oxide-coating on cemented carbide tools used for metal cutting have been regarded as inert during cutting of steels. Because diffusional dissolution is not possible. Chemical degradation of aluminum oxide coatings is often overlooked, especially in the presence of ambient oxygen and non-metallic inclusions. High-pressure diffusion couples, advanced microscopy, and thermodynamics are used to investigate and predict the chemical degradation of aluminum oxide-coated tools. During interactions with steel and different combinations of inclusions with and without ambient oxygen. The results show that alumina is resistant to chemical degra-dation by steel in the absence of oxygen. However, this is not the case when oxygen and non-metallic inclusions are present. These experiments and microscopy together with the thermodynamic calculations allow for the creation of a method and guidelines for chemical wear modeling and steel inclusion engineering when machining with aluminum oxide-coated tools.