Nano-mechanical fabrication technology using atomic force microscopes (AFM) has been developed for practical applications, however, the fabrication process has not been understood clearly yet, and thus optimal conditions for fabrication have been determined by trial and error. We have developed a nano-mechanical fabrication system using AFM which works in a scanning electron microscope (SEM), and thereby succeeded in the real-time observation of the nano-scale cutting process. This technique is expected to be a powerful tool for clarifying the removal mechanism of materials in cutting process, and for optimizing fabrication conditions, and to accelerate technological development for practical applications such as the fabrication and repair of nano-molds.