The small hole EDM is one main method of micro holes machining and applied very widely. But it’s machining efficiency is low and machining stability is bad, which is more obvious because of chip-ejection difficulty when the ratio of length to diameter is rather large. Secondary discharge caused by chip-ejection difficulty not only makes the material removal rate reduce, but also causes geometric tolerance and affects product performance. Based on dispersion mechanism study of the water dispersant, the influence of the water dispersant is analyzed to chip-ejection, material removal rate and machining quality of the high-speed small-hole EDM. By contrasting the machining effect on using tap water with disperser dielectric liquid during electric spark small hole machining, adding the certain proportion disperser in water-based dielectric liquid may increase the material removal rate, decrease the tool wear rate, improve the effective impulse numbers, obviously reduce the second discharge number, and the taper of tool electrode and hole becomes small, so the hole machining quality enhances.