Manufacturing industries in strategic and other hi-tech areas are increasingly using the percussion mode of laser drilling for component development. In this paper, the optothermal effects of laser-metal interaction are analysed from a modelling viewpoint. A model of percussion laser drilling is presented that considers melt displacement/fracture in the semi-solid or solid state together with material removal by melt expulsion and evaporation. Predicted von Mises stresses (due to thermal strain in vicinity of the hole) exceed the tensile strength of the workpiece material (SUPERNI 263A) which are likely to displace/fracture material in vicinity of the hole. The model agrees well with our experimental findings.