We report the first microscopic observation of complex precipitates coexisting with LPS phases in Mg 97 Zn 1 Y 1.5 Nd 0.5 (at %) alloy formed by aging at 473 K, and their effects on mechanical properties. It was found that the β’ [space group Cmc2 1 , a = 0.68 nm], β 1 [space group Fm3¯m, a = 0.77 nm] phases and GP zones in α-Mg matrix are responsible for the peak hardness; which appeared after 30 h of annealing at 473 K, while large β 1 precipitates and GP zones appeared in an over-aged specimen. With the increase of the annealing temperature from 473 K to 523 K, stacking faults, together with GP zones appeared. It is proposed that the precipitates and GP-zones contribute simultaneously to the age-hardening process, and that GP zones are more stable at 473 K than 523 K.