In FMS (Flexible Manufacturing System) and CIM (Computer Integrated Manufacturing), machine-tools have been the target of integration in the last three decades. The conventional concept of integration is being changed into the autonomous manufacturing device based on the knowledge evolution by applying advanced information technology in which an open architecture controller, high-speed network and internet technology are included. In the advanced environment, the machine-tools is not the target of integration anymore, but has been the key subject of cooperation. In the near future, machine-tools will be more improved in the form of a knowledge-evolutionary intelligent device. The final goal of this study is to develop an intelligent machine having knowledge-evolution capability and a management system based on internet operability. The knowledge-evolutionary intelligent machine-tools is expected to gather knowledge autonomically, by producing knowledge, understanding knowledge, reasoning knowledge, making a new decision, dialoguing with other machines, etc. The concept of the knowledge-evolutionary intelligent machine is originated from the machine control being operated by human experts' sense, dialogue and decision. The structure of knowledge evolution in M2M (Machine to Machine) and the scheme for a dialogue agent among agent-based modules such as a sensory agent, a dialogue agent and an expert system (decision support agent) are presented in this paper, with intent to develop the knowledge-evolutionary machine-tools. The dialogue agent functions as an interface for inter-machine cooperation. To design the dialogue agent module in an M2M environment, FIPA (Foundation of Intelligent Physical Agent) standard platform and the ping agent based on FIPA are analyzed in this study. In addition, the dialogue agent is designed and applied to recommend cutting conditions and thermal error compensation in a tapping machine. The knowledge-evolutionary machine-tools are expected easily implemented on the basis of this study and shows a good assistance to sensory and decision support agents.