This research aimed to evaluate and optimize drilling parameters and tool design for improved machining quality in wood composite materials. The effects of drill bit type (twist vs. spotting), spindle speed, and composite formulation (varying wood species and ratios) on hole diameter, defect formation, and dimensional accuracy were systematically analyzed using a controlled experimental approach. Results showed drill speeds above 600 rpm exponentially increased hole over sizing and variability. Twist bits provided greater dimensional stability across speeds versus spotting bits. A wood-based composite type mixed with 50% Kelempayan Wood (Neolamarckia cadamba) and 50% rubber showed the most minor defects in the holes across various parameters in this study. The twist drill bit consistently outperformed the spotting drill bit, yielding holes with fewer defects and enhanced dimensional precision, as indicated by the results. Among the five tested drill speeds (300rpm to 1500rpm), the lowest speed of 300rpm consistently produced holes with the lowest overall defect rates across various drill bits and composite materials. The findings provide comparative insights into the complex interplay between operating factors influencing machined hole quality in wood materials. They highlight the need for meticulous drill condition and parameter selection to minimize undesirable tear-out while meeting target hole dimensions. Further work is recommended to expand the parameter space and analytical techniques. This will enable more comprehensive determination of optimal methodologies for precision drilling in high-performance wood composites suitable for advanced engineering applications.