Through-tool minimum quantity lubrication (MQL) drilling has been used in industry for decades, but little information is available on the coolant channel design and the effect on fluid distribution due to the inability of in-situ measurement. This study utilizes an Euler–Lagrange computational fluid dynamics (CFD) model to uncover the two-phase flow behavior in MQL drilling. Air is the primary phase modeled as a compressible and turbulent flow. The lubricant droplets are simulated as discrete particles with a proper size distribution. Two-way coupling and droplet-wall interactions are both considered. The results show that the primary phase can reach velocities in the transonic region and is dependent on the helical path of the channel. In addition, most of the lubricant droplets (>95%) impact the channel wall to form fluid film instead of following the air stream. In the cutting zone, droplets can hardly reach the cutting edges in both circular and triangular channel shapes. Finally, a custom-made drilling testbed, along with a transparent work-material simulant, is used to observe and qualitatively validate these results.