An integrated laser material processing cell allowing laser-assisted machining to be used in conjunction with directed material deposition in a single setup, achieving greater geometric accuracy and better surface finish than currently possible in existing laser freeform fabrication techniques. The integration of these two processes takes advantage of their common use of laser beam heat to process materials. The cell involves a multi-axis laser-assisted milling machine having a work spindle, a laser emitter, and means for positioning the emitter with respect to the spindle so as to direct a laser beam onto a localized area of a work piece in proximity to a cutting tool mounted in the spindle. A powder delivery nozzle mounted on the machine and positioned adjacent to the emitter delivers powder to a deposition zone in the path of the beam, such that material deposition and laser-assisted milling may be performed substantially simultaneously in a single workspace.