Abstract: AM60 alloys with different Nd contents were prepared in vacuum resistance furnace under Ar atmosphere, and then T4 heat treatment was carried out in box-type resistance furnace. The change law of the microstructure and mechanical properties of two state alloys was studied. The results show that the microstructure of as-cast alloys mainly consisted of α-Mg matrix phase, β-Mg17Al12 phase and Al11Nd3 phase. After T4 heat treatment, the β-Mg17Al12 phase decomposed and dissolved into the α-Mg matrix phase. The grain size of alloys was refined obviously and the morphology of Al11Nd3 phase changed greatly. With the increase of Nd content, the tensile strength, yield strength and elongation increased first and then decreased. The peak values of the mechanical properties changed from 0.9%Nd in as-cast state to 0.3%Nd in T4 state, which reached 239 MPa, 138 MPa and 8%, respectively. The microhardness of the 0.6%Nd alloy reached 70.5 HV.