Electrical discharge machining is a non-conventional material removal process; recently, efforts have been made to use it as a surface alloying/modifying method. This study investigates and compares the micro-hardness of the surface machined by electrical discharge machining process using composite tool electrode (copper–chromium–nickel) manufactured by powder metallurgy and conventional copper tool. Design of experiment is used to find the best level of process parameters in order to achieve high micro-hardness. The machined surfaces are subsequently analyzed using different techniques like scanning electron microscopy, X-ray diffraction and energy-dispersive spectroscopy to ascertain the surface characteristics. Results indicate that the micro-hardness of the alloyed surface formed by powder metallurgy tool electrode is improved by 96.3% as compared to base material and 65.7% as compared to the surface machined by conventional copper electrode. Energy-dispersive spectroscopy of the surface machined using powder metallurgy electrode confirms significant material migration from tool and dielectric to the machined surface. The X-ray diffraction shows the formation of cementite (Fe₃C), intermetallic compound of iron, chromium and nickel (FeCrNi) and chromium carbide (Cr₇C₃) on the surface machined using powder metallurgy electrode.