Abstract: A Floating Tool Holder includes a shank having an annular sleeve secured to one end thereof, there being a tool chuck assembly retained between the end of the shank and a flange on the sleeve, driver means for transmitting rotary motion from the shank to the tool chuck assembly, there being a pair of annular bearings which engage the tool chuck assembly and enable slight relative radial movement, the bearings having flat surfaces which constitute a thermal diffusion of a metal boride, such as di-iron boride. There is a seal between the tool chuck assembly and the sleeve, and centering means acting between the shank and the tool chuck assembly and constructed to enable the conducting of a coolant through the shank into the tool chuck assembly, certain components being further constructed to enable length of the device to be minimized. The tool chuck assembly has a deep hole receptive of a substantial portion of a tool.