This research proposes an innovative mechatronic piezo-actuated module to control vibrations in modern machine tools. Vibrations represent one of the main issues that seriously compromise the quality of the workpiece. The active vibration control (AVC) device is composed of a host part integrated with sensors and actuators synchronized by a regulator; it is able to make a self-assessment and adjust to alterations in the environment. In particular, an innovative smart actuator has been designed and developed to satisfy machining requirements during active vibration control. This study presents the mechatronic model based on the kinematic and dynamic analysis of the AVC device. To ensure a real time performance, a H2-LQG controller has been developed and validated by simulations involving a machine tool, PZT actuator and controller models. The Hardware in the Loop (HIL) architecture is adopted to control and attenuate the vibrations. A set of experimental tests has been performed to validate the AVC module on a commercial machine tool. The feasibility of the real time vibration damping is demonstrated and the simulation accuracy is evaluated.