The ultra-precision dicing of hard and brittle materials causes high wear on the abrasive tool which results in the deterioration of blade cross section as well as the decrease of diamond grain exposure. Resin-bonded diamond blades are used due to their in-process self-sharpening capability. Nevertheless, the shape of the blade cross section generated by self-sharpening is random which leads to poor accuracy when precise grooves need to be produced. Metal-bonded diamond blades feature higher tool lifetime and shape accuracy compared to resin-bonded blades, but are not capable of performing self-sharpening. In this study, the laser dressing of metal-bonded diamond blades is investigated to enable their use in the ultra-precision dicing of hard and brittle materials by continuous laser dressing. We investigated laser dressing with and without the presence of cooling water. The sharpness (grain exposure) after dressing is measured by the cutting face surface roughness. The dicing performance is evaluated by observing the dicing results in terms of cutting depth consistency and by monitoring the spindle power during dicing. Dicing blades which have been laser dressed in an environment with coolant feature less grain exposure than dicing blades which have been laser dressed in dry condition. The dicing results show an improvement in the sharpness and durability of laser-dressed dicing blades in comparison with new or conventionally dressed blades. The ability to apply and perform laser dressing on a dicing machine in an environment with coolant shows the feasibility of laser technology for continuous dressing.