Chatter vibration is a major obstacle in achieveing increased machining performance. In this research, a finite element model of chip formation in a 2D milling process is used to predict the occurrence of chatter vibrations, and to investigate the effects of various machining parameters on this phenomenon. The dynamic properties of the machine tool at the tool tip are obtained based on experimental modal analysis, and are used in the model as the cutter dynamics. The model allows for the natural development of vibration as the result of the chip-tool engagement, and accounts for various phenomena that occur at the chip-tool interface ultimately leading to stable or unstable cutting. The model was used to demonstrate the effects of the machining parameters, such as the axial depth of cut, radial immersion, and feed rate, on the occurrence of chatter. Additionally, the phenomenon of jumping out of the cut region could be observed in this model and its effect on the chatter process is demonstrated. The numerical model is verified based on comparisons with experimental results. © 2018, Shanghai University and Springer-Verlag GmbH Germany, part of Springer Nature.