Percussion drilling and trepanning are two laser drilling methods. Circular laser spots are generally used in conventional laser drilling. Annular laser beams provide a new laser drilling mechanism. When an annular beam is focused on the workpiece surface, the material around the annulus laser spot is heated, melted, vaporized and removed, leading to the formation of a hole. This process, which we refer to as optical trepanning, does not involve any rotating optics or rotating workpiece. Based on the ray tracing technique, an optical lens system using axicon lenses has been designed to transform a Gaussian circular laser beam into an annular laser beam. Both theoretical and experimental results of irradiances of the annular beam along the optical system were analyzed. Optical trepanning experiments were conducted on stainless Steel-316. Some geometrical and metallurgical characteristics during optical trepanning were investigated.