Machining hardened steels is a common requirement in various industries. This includes gearing and spline cutting on hardened steel parts at high speeds. Traditionally, gearing tools were made of high-speed steels, which made them suitable only for gearing at low cutting speeds with coolant. However, hard gearing using disk cutters with interchangeable carbide inserts is a new and flexible method for machining various types of splines and gears without special equipment. In this research, a disk cutter with four carbide cutting inserts is designed and manufactured. Experimental analysis is performed to assess the applicability of the developed cutter in machining splines on hardened steel axle shafts. Workpieces made of DIN 60SiMn5 steel with a hardness of 46 HRC and AISI 1552 steel with a hardness of 61 HRC are machined using two types of carbide inserts in wet and dry cutting conditions. Results show achieved surface roughness values in the range of 0.161 μm < Ra < 0.376 μm, which is an indication of a very good surface quality. Also, ANOVA methods are used to assess the impact of input parameters on machined surface roughness and cutting tool wear. The analysis shows that surface roughness is most affected by insert type, while use of coolant is the most effective parameter on tool wear. This research also proves applicability of dry milling as a sustainable and environmentally friendly method for spline cutting on hardened steels.