This paper presents a knowledge-base approach that assists a designer to evaluate possible process plans and associated costs based on tolerancing specifications of the designed part. It is an effort to take dimensional tolerances into computer-aided process planning (CAPP) for cylindrical parts through the usage of databases and knowledge bases. Geometric features with tolerancing specifications in a CAD system are first used to determine possible machining operations that can achieve the specified tolerances based on data from the machining feature database, the process precision grade database, and the precision grade database. Process plans are then generated based on rules and knowledge from process sequence knowledge base and the machining feature database. Possible process plans are further organized as a graph. Optimal process plan with least cost is then selected by searching through the graph. This is achieved based on machine set-up and operation costs that are derived from the machine tool resource database, the process parameter database, and the machine set-up and operation cost database. A CAPP software prototype supporting tolerance design on the AutoCAD platform is also demonstrated with examples to illustrate this approach.