Bar rolling is a semi-continuous rolling process involving a series of rollers, where a cast billet is shaped into the final TMT bar. In these mills, low-thickness bar rolling (< 20 mm) is prone to cobbles, due to several operational reasons, which affects productivity. One major contributor is blockage of slitters and no-twist mill grooves due to excessive chip formation from the rolled bars. In the present work, a detailed investigation was carried out to identify the causes of chip formation through visual and metallographic analysis of the bar samples collected at different stages of rolling. It was found that the chipping was predominantly on a specific side of the bars and was related to quarter distance segregation in the cast billets due to higher sulfides and the use of powders for mold lubrication. The ‘square–round–oval-dog bone’ pass design exposed the lowest quality part of the billet at the slitter, leading to chip formation near the slit surface. Control of sulfur in steel and the use of oil lubrication at the caster reduced the segregation in the billets and subsequently chip off defects at the rolling mill.