3-axis machining: 3-axis machining is CNC milling in which the cutter moves along the X, Y and Z axes while the part stays fixed, reaching the part from one direction per setup.
This is the most common kind of CNC mill. The tool moves left and right, front and back, and up and down, but always points straight down at the part. Features on the top face are easy. Features on other faces need the part to be turned over and clamped again, and each of those is a new setup. An undercut that cannot be seen from above needs a special cutter or a different machine.
What it means for the price
Three-axis machines have lower hourly rates than five-axis ones, so simple parts are cheapest here. Every extra face that needs machining usually adds a setup: re-clamping, re-zeroing and checking. That costs time and risks small errors between features on different faces. A part that needs many setups on a three-axis machine can be cheaper on a 5-axis machine despite the higher rate.
Example: a block with features on four faces needs four setups on a three-axis mill. At 20 minutes each, that is 80 minutes of setup for every batch. The figures are an example.
Common confusions
“3+2” machining is done on a five-axis machine that locks the part at an angle and then cuts in three axes; it is not a three-axis machine. Good workholding can reduce setups too. Read 3-axis vs 5-axis machining.
Go deeper: 3-axis vs 5-axis machining: cost and capability