Additive and subtractive manufacturing systems for in-envelope production of large objects face challenges with respect to reach and access of cutting tools. One approach to overcoming this is iteratively alternate between additive and subtractive processes. However, polymer objects require cooling before machining, resulting in poor thermal welding when the subsequent polymer layer is deposited. This paper describes a method to enable iterative processing for in-envelope hybrid manufacturing that uses a mechanical bond to transition back to additive deposition after machining. This is accomplished using an AMBIT screw-extrusion head to additively manufacture a section of the object within a 5-axis machining center. After the object is machined, a dovetail cutting tool forms undercut geometry in the interface where plastic extrusion will resume. Upon polymer solidification, a mechanical interlock is formed. This work evaluates several undercut geometries for mechanical performance. This iterative approach to hybrid additive/subtractive manufacturing reduces machining complexity while maintaining structural integrity.