A method of manufacturing a cross fin tube and a cross fin type heat exchanger including the cross fin tube obtained in accordance with the manufacturing method. A tube-expanding plug has cutout-forming protuberances which are formed on an outer circumferential surface thereof with a number of 60-160 per circumference such that the cutout-forming protuberances extend in a direction which intersects primary grooves which are previously formed on an inner circumferential surface of a heat transfer tube, and at the same time when the heat transfer tube and plate fins are fixed integrally to each other in accordance with the mechanically tube-expanding operation, secondary grooves which are cross grooves with respect to the primary grooves are formed to have a depth (d2) which is held in a range of 10-40% of a depth (d1) of the primary grooves.