The characteristics of DC hollow cathode discharge and cathode sputtering was investigated by means of a two dimensional hybrid model, combing Monte Carlo simulation of the motion of fast electrons and a fluid description of slow electrons and positive ions. The results demonstrate the existence of the hollow cathode effect in the discharge and show that the spatial shape of the normalized ionization source is dependent more on the gas pressure than on the discharge voltage. The factors related to the cathode sputtering were analyzed. Investigations have demonstrated that the non uniform sputtering on the cathode surfaces in a sputter-type ion laser is due to the non-uniform distribution of electric field, flux and density of ions bombarding the cathodes.