<p>The wafer retaining ring, as a vulnerable part in the chemical mechanical polishing process, is a huge hidden cost in the CMP process. The machining quality of the retaining ring will affect its lifespan, so it is necessary to understand and analyze the machining process of the retaining ring. When grinding the chip retaining ring, a large amount of heat is generated on the processed surface; the dynamic thermal–mechanical coupling effect will affect the surface quality. This paper introduces a new theoretical model for coupling based on effective abrasive dynamic removal. Firstly, a digital twin simulation model of an abrasive wheel is created. Next, the dynamic mechanics of the machining process are solved and analyzed by considering the abrasive grain size and projection height. The dynamic thermal relaxation is calculated using the finite volume method and validated through the finite element method. Due to the dynamic thermal–mechanical coupling, the surface of the workpiece will be unevenly processed during the grinding process. Finally, by measuring the surface profile of the retaining ring, it is found that the thermal effect model is reflected in the distribution of the surface profile, which verifies the accuracy of the theoretical analysis. As a result, the surface quality of the machined workpiece can be effectively improved by reducing the workpiece speed. The results of the study have significant implications for wafer processing enterprises.</p>