An experimental study of shear band formation in cutting of metals is made using a low melting point Bi-based alloy as a model material system. High-speed imaging is used to capture the transition in the plastic flow, from laminar to shear banded flow, as a function of cutting speed. The dynamics of shear band nucleation is captured in situ and temporal evolution of localized plastic flow during shear band growth is quantitatively analyzed using an image correlation method, particle image velocimetry (PIV). The observations show that shear band nucleation is governed by a critical shear stress criterion, and accompanied by a large drop in the flow viscosity by several orders of magnitude, analogous to the phenomenon of yielding in yield-stress (Bingham) fluids. Likewise, the displacement field around a freshly nucleated shear band evolves in a manner resembling the boundary layer formation in planar flow of a Bingham fluid with a very small viscosity. Surprisingly, temperature has little influence on shear band nucleation or growth.