A new Soft Abrasive Grinding Wheel (SAGW) was developed for Chemo-mechanical Grinding (CMG) of silicon wafers to overcome the surface/subsurface damage of the silicon wafer machined by traditional ultra-precision grinding. According to the principle of the CMG and the material characteristics of monocrystalline silicon, the SAGW took the cerium oxide (CeO2) as abrasive, silicon dioxide (SiO2)as additive, and the chlorine oxide magnesium as binding agent. The preparation process of the SAGW was investigated, and its microstructure and composition were analyzed. By measuring the surface roughness, surface microstructure and the surface/subsurface damage, the grinding performance of the SAGW was further explored. In the end, fabricated silicon wafer with the same particle size by the SAGW, Chemical Mechanical Polishing (CMP) and diamond grinding wheel was compared and analyzed. The results show that the surface roughness of the silicon wafer by the SAGW is less than 1 nm and its subsurface damage layer is about 30 nm in thickness , which is comparable to that produced by the CMG and much better than that of the diamond wheel. This study demonstrates that the developed SAGW achieves the low-damage grinding of silicon wafers.