Zirconia ceramics (ZrO2) have been used for a variety of applications due to their superior physical properties, including in machining tools and dentures. Nonetheless, due to its extreme hardness and brittleness in both sintered and half-sintered forms, zirconia is difficult to machine. In this study, half-sintered zirconia blocks are milled with tungsten carbide milling tools which arecoated with diamond film using hot filament chemical vapor deposition (HFCVD) at various substrate-to-filament distances. The objective was to determine the effect of substrate-to-filament distances on the coating thickness, diamond purity, coating grain size, and ZrO2 machining performance during HFCVD. The experimental results show that, in HFCVD, the grain size and coating thickness of the diamond film on milling tools tend to decrease when the substrate-to-filament distances decrease. Tool failure happened at a cutting time of 200 min for all coated tools. However, the machining quality in terms of surface topology, surface roughness, and tool condition is superior for diamond-coated milling tools with smaller grain sizes and thinner thicknesses. It can be concluded that diamond milling tools with a smaller grain size and lesser thickness produced under shorter substrate-to-filament distances have a superior machining performance and a longer tool life. This study could potentially be used for parameter optimization in the production of coated tools.