Microstructure and mechanical properties of Mg-15wt.%Gd-5 wt.%Y-0.5wt.% Zr alloy were investigated in a series of conditions. The eutectic was dissolved into the matrix and there was no evident grain growth after solutionized at 525 °C for 12 h. The evolution of the phase constituents from as-cast to cast-T4 was as follows: α-Mg solid solution+Mg 5 (Gd,Y) eutectic compound → α-Mg solid solution+ spheroidized Mg 5 (Gd, Y) phase → α-Mg supersaturated solid solution+cuboid-shaped compound (Mg 2 Y 3 Gd 2 ). And the precipitation sequences of Mg-15Gd-5Y-0.5Zr alloy were observed, according to the hardness response to isothermal ageing at 225–300 °C for 0–128 h.