The aims of this research are to develop manufacture and evaluate a rice-straw disc chipper. The disc chipper consists of frame, feeding duct, and rotating disc with three knives, fixed knife, suction fan and 5.6-kW electric motor. The studied performance-factors are: cutting-knife speeds of 800, 1000, 1200, and 1400 rpm (16.76, 20.94, 25.13and 29.31 m/s), clearances between rotating knives and disc of 5, 10, 15 and 20 mm and rice-straw moisture contents of 14, 18, 22 and 26 % in wet base. The main results were summarized in the following points: * The maximum average of cutting length of 25.2 mm was obtained by using fan, cutting-knives speed of 800 rpm (16.76 m/s), rice-straw moisture content of 26 % and clearance of 20 mm. Meanwhile, the minimum average of cutting length of 4.3 mm was obtained by using the chipping machine without fan, cutting-knives speed of 1400 rpm (29.31 m/s), rice-straw moisture content of 14 % and clearance of 5 mm. * The maximum machine productivity of 333.6 kg/h was obtained by using fan, cutting-knives speed of 1400 rpm (29.31 m/s), rice-straw moisture content of 26 % and clearance of 20 mm. Meanwhile, the minimum machine productivity of 66.2 kg/h was obtained by using the chipping machine without fan, cutting-knives speed of 800 rpm (16.76 m/s), rice-straw moisture content of 14 % and clearance of 5 mm. * The minimum production cost of 34.4 L.E./ton was obtained by using rice-straw moisture content of 26 % and at optimum knives-speed of 1400 rpm (29.31 m/s) using fan and  clearance of 20 mm.