Electrical discharge machining (EDM) is used in cutting special steel accurately; in this paper the effect of electrode material has been studied to avoid resulting residual stresses, the surface roughness and cracks. Two types of EDM electrode materials has been 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 have been chosen “rough, medium, and soft, and it is 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 the surface roughness appeared in DIN 1.2080 using Dura Graphite 11 electrode, also Residual stresses were studied upon the surface and its 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