This paper extends the proposed dynamic analysis of spindle with conventional bearings of Part 1 and demonstrates feasibility of hybrid bearing set (HBS) usage in machine tool spindles. HBS consists of permanent magnet bearing (PMB) and conventional angular contact bearing (ACB). The rotordynamic and unbalance response of vertical machining center (VMC) spindle supported by HBS is presented. Harmonic responses are also determined using Ansys Workbench finite element tool. Results show that the system is stable at obtained frequencies, critical speeds are higher than the spindle operating speed range, and the maximum unbalance response is within acceptable limit. The comparison between the results of ACB and HBS has verified that the HBS can effectively be used in machine tool spindles with higher critical speeds and maximum amplitudes generating due to cutting forces.