In order to provide guidance for further improving the performance of coated tools for rail(U71Mn) milling, the failure behavior of PVD-TiAlN coated tools for U71Mn milling was analyzed. Simultaneously, the wear mechanism and failure mechanism of the coated tools were determined. The TiAlN coating with a thickness of about 2.13 μm was prepared on cemented carbide tools by multi-arc ion plating technology. The substrate and coating of the tools were detected by scanning electron microscope (SEM), energy dispersive spectroscopy (EDS) and metallography. Vertical milling machine with the PVD-TiAlN coated tools was used to mill U71Mn. SEM was used to observe the micro morphology of the front surface, edge and flank surface of the failed tools. The wear mechanism and failure mechanism of the coated tools were determined by EDS micro-zone composition analysis and SEM micro morphology analysis. Through metallographic and SEM tests, YG10 fine grain cemented carbide had no obvious structural defects. The film-substrate adhesion strength of the coating prepared by multi-arc ion plating was HF1, which indicated that the film-substrate adhesion strength was good. There were cracks through the front surface, edge and flank surface of the failed tools, but there were fillings of processed materials inside the cracks only in the edge area. The coating on the crack tip of the flank surface of failed tools was slightly broken. The wear zone boundary of the rake face is flatter than the wear zone boundary of the flank face. Cross cracks appeared on the coating surface near the edge. There were many jagged edges with many fragmental fillings at the edges of the failed tools. Many grooves of different depth were distributed the flank surface corresponding to these gaps. The worn edge was covered with a large amount of processed material. The wear mechanism of tools included abrasive wear, adhesive wear and oxidation wear. In addition, the collapse of the edge also played an important role in the failure process of the coated tools. The cracks provided storage space for the hard particles, which promoted abrasive wear. Under the action of multiple wear mechanisms, the edge was finally worn out. The milling performance of coated tools for U71Mn milling could be improved by improving the strength and toughness of the substrate, rational cutting-edge design, improving the toughness and adhesion of the coating, and improving the oxidation resistance of the coating.