Accurate estimation of volumetric errors is an important issue in machining operations. For this purpose, a kinematic error model is used to characterize machine tool’s related errors on its workspace. In this research, it is shown that when measuring the linear and positioning errors using a laser interferometer, part of the angular errors are converted to linear and positioning errors and their magnitudes are overestimated. These values are calculated twice in the models which use homogeneous transformation matrix since Abbe’s principle is not considered. In this article, a kinematic error model is proposed which eliminates this overestimation. This model’s methodology is based on rigid body kinematic and errors measurement by laser interferometer and can be generalized for all three-axis machine tools. A software package is developed to integrate the kinematic errors with the NC-codes. A workpiece is machined in the virtual environment and compared with a workpiece machined in real environment. It is shown that the kinematic error model developed in this research predicts the kinematic errors more accurately.