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PROBLEM TO BE SOLVED : To provide a water-soluble oil agent for machining a rare earth magnet which suppresses bubbling and clouding of an oil agent caused during machining a rare earth magnet with the use of a water-soluble oil agent containing an organic acid and a basic compound as principal components and which is thus effective for improving work efficiency and machinability. SOLUTION : The water-soluble oil agent for machining a rare earth magnet contains an organic acid and a basic compound, and further contains a polymeric flocculant. Owing to the inclusion of the polymeric flocculant, the water-soluble oil agent allows a fine oxide and/or hydroxide produced during machining to be agglomerated together and settled down along with chips as a metal component, and a simple apparatus employing a settling separation method, a magnetic separation method or the like can be used to separate the fine substances from the oil agent. As a result, generation of inextinguishable bubbles and clouding of the water-soluble oil agent caused during machining of a rare earth magnet can be suppressed to improve machining properties and workability. COPYRIGHT : (C)2012, JPO&INPIT