The system allows manufacturers to run machine tools unmanned, with complete confidence that cutting tools damaged during a machining cycle will be quickly detected, eliminating the risk of scrapped parts. This innovative new unit projects a beam of laser light at a tool and monitors the scattered light that is reflected, to determine if the tool has been broken. It uses tool recognition technology that distinguishes between the tool and coolant or swarf/metal chips, and is also fast and reliable under real machining conditions.