For CNC machine tools in industrial applications for manufacturing high-precision mechanical parts, control parameters are usually tuned manually by master workers with a trial-and-error technique. However, this trial-and-error technique wastes manpower and time, and the tuned parameters would never approach perfect values, but provides only acceptable results. To address this problem, a parameter-tuning technology based on Taguchi method is developed in this study to determine the best-fitted control parameters of CNC machine tools. The developed parameter-tuning technology makes it easy for CNC machine operators and manufacturers to tune the settings of control parameters. Several circular tests, important tests for precision measurement of CNC machine tools, were carried out on a CNC milling machine to illustrate the validity of the proposed parameter-tuning method using Taguchi method. The best rate of improvement in the reversal spikes at the four quadrants was 60.87% and the rate of improvement for the roundness was 35.00%. It can be seen that the reversal spikes and roundness of the best-fitted parameters are better than that of the original parameters tuned by an experienced operator. Therefore, the results validate the feasibility of the developed parameter-tuning method for determining the best-fitted control parameters of CNC machine tools.