In this study the effect of electrode material was studied to avoid resulting residual stresses, the surface roughness and cracks resulted during Electrical Discharge Machining (EDM). Two types of EDM electrode materials were chosen, Dura graphite 11 and Poco graphite EDMC-3. Two grades of tool steels are chosen as test materials, DIN 1.2080 and DIN 1.2379. Different machining methods were chosen ‘‘rough, medium, and soft’’, it was found that the Dura graphite 11 exhibits more surface cracks upon DIN 1.2379 less micro-cracks appeared on the surface than on DIN 1.2080 while the higher surface roughness appeared in DIN 1.2080 using Dura Graphite 11 electrode, also Residual stresses were studied upon the surface and it was found that POCO Graphite EDMC-3 electrode results higher residual stresses compared with Dura Graphite 11 electrode. Also Soft EDM machining exhibits higher residual stresses as a result of higher pulse on duration time .