A method of machining a groove portion of a predetermined width and depth on a workpiece with a rotary tool that has a plurality of cutting inserts mounted at regular intervals on the outer periphery surface of a disc-shaped main body, wherein the rotary tool is rotated and moved so that its outer periphery surface reaches a predetermined depth of cut based on the surface to be machined of the workpiece and then the rotary tool and the workpiece are fed relatively in the shifting direction for machining the groove portion, in a state in which the rotating direction at the point at which the outer periphery surface of the rotary tool contacts the workpiece is inclined at a predetermined angle to the shifting direction for machining the groove portion.