Few-layer graphene was successfully tailored with smooth edges along crystallographic directions by Joule heating-driven tungsten nanoparticles inside a transmission electron microscope. The dynamic process was monitored in real time at the atomic resolution level. These high-resolution in-situ observations show that the neighboring graphene layers joined together to form closed edges, which is in contrast to the supposed open edges formed with hydrogen passivation. The tungsten nanoparticles transformed to W2C in the intermediate stage of etching and to WC after etching, suggesting that carbon dissolution helped the continuous action of the metal nanoparticles in the catalytic anisotropic etching reaction.