The paper introduced the principle, characteristics, and advantages and disadvantages of three methods of vacuum evaporation, sputtering and ion plating in physical vapor deposition (PVD) technology, and introduced the PVD coating technology that is widely used in cutting tools by four categories of binary, multiple coatings, multilayer coatings and nano multilayer composite coating. Based on a large amount of literature, combined with the author’s experience in the research and application of PVD technology for many years, the paper reviewed the research progress of superhard nano-micron PVD coating technology in the field of application of cutting tool from the most important perspective of improving the cutting tool life, and further discussed the multiple coating, multilayer coating and nanometer coating in details. Cutting tool surface with application of physical vapor deposition coating technology enabled the tool to obtain excellent overall performance, which significantly improved the life of cutting tools, reduced production costs, and increased the machining efficiency substantially. Finally, the paper forecasted the wide application of physical vapor deposition coating technology in composite superhard cutting (including milling of mold steel, hardened steel whose hardness over HRC55), cutting hard processing materials ( including high-temperature alloys, titanium alloy, stainless steel, etc. ), machining and processing composite materials of graphite and carbon fiber, etc. and high-speedily machining non-ferrous metals (including aluminum, copper alloys, nickel, etc. ) in the future.