Machine tools are operated at higher speeds vibrations are generated between workpiece and tool, results dimensional variation and poor surface finish on machined components. Hence, machine tools are developed with high dynamic stiffness by using high stiffness and damping composite material to reduce such effects and to achieve better dimensional accuracy with good surface finish on machined components. The machine tool structure considered in this study is a cast iron (CI) micro-lathe bed. The numerical model of the reference cast iron micro-lathe bed taken up for study was developed and experimental validation of the same was done. Static finite element analysis of the validated numerical model with worst-case cutting forces and moments was carried out for three different materials, namely gray cast iron, epoxy granite, and nettle polyester, and the results were compared, and the need for form design was justified. Static characteristics are improved through the use of cross sections and rib configurations with higher bending and torsional stiffness. Dynamic characteristics are improved through the use of stone- and fiber-based composite materials with higher specific stiffness and damping properties. The improvements in static and dynamic characteristics of the newly developed structures are investigated.