Abstract: CNC machine tool is a high-precision automatic processing equipment widely used in modern manufacturing industry, which has the advantages of high efficiency, high precision and high degree of automation, and has become an important support for the development of modern manufacturing industry. Based on the basic structure and working principle of CNC machine tools, this paper systematically discusses the basic working principles and application methods of three key technologies by focusing on CNC machine tool online monitoring technology, fault diagnosis technology and digital twin technology, and through continuous optimization and application of these technologies, the stability, reliability and automation degree of CNC machine tools can be further improved, and the sustainable development of modern manufacturing industry can be promoted. The research results aim to provide a reference for manufacturing enterprises to improve the production efficiency of CNC machine tools, ensure the processing quality and reduce the failure rate.