A free-cutting nickel-copper alloy is disclosed whose ingredients by percent are that: carbon<=0.3, manganese <=2.0, iron<=2.5, sulphur 0.025-0.060, silicon<=0.5, copper 28.0-34.0, the rests are nickel, the manufacturing method of the free-cutting nickel-copper alloy comprises the steps of: 1, loading and vacuumizing; 2, controlling the temperature within the range from 1500 to 1650 DEG C, refining for 5 to 25 minutes, adding deoxidizer and finally the sulphide to lead the sulphur content in the nickel-copper alloy to be between 0.020% and 0.08%, the optimized sulphur content is 0.040% 0.06%, the sulphide is one of manganese sulphide, iron sulphide, copper sulphide and high nickel matte or mixture thereof, the deoxidizer is one of carbon and nickel-magnesium alloy, calcium-silicon alloy, and copper-zirconium alloy or the mixture thereof; 3, measuring the temperature and casting at the temperature between 1400 and 1500 DEG C for 30 seconds at most, and vacuumizing for at least 10 minutes; the good cutting performance of the steel remarkably improves the cutability of steel, reduces the cutting force and cutting temperature, conspicuously prolonging the life of cutting tool, lessens the surface roughness of working piece and improves the cut-processing performance.