A new method to realize stable and realistic cutting simulation using an impedance display haptic device and microcomputer is presented in this paper. Material removal or cutting simulation is a critical task in dental preparation surgery simulation. In this paper, a piecewise contact force model is proposed to approximately describe the cutting process. Challenging issues of minimizing the difference between the cutting simulation and haptic contact simulation are analyzed. The proposed contact-based simulation method is developed for a one-dimensional cutting task and can be expanded to three-dimensional cases. Local model-based multirate simulation cutting architecture is proposed and force control of the haptic device is decoupled from the cutting simulation loop, which can both ensure high fidelity of dynamical simulation as well as maintain stability of the haptic device. The cutting operation is realized using spherical and cylindrical shaped tools. An experiment based on the Phantom desktop proves that fidelity in one-dimensional cutting can be realized and stability in three-dimensional cutting can be ensured using the force-filtering method.