In this study, the comprehensive performance of AZ80 magnesium alloy was improved by solution treatment and multi-step ageing treatment. The effects of different thermal processing parameters on the microstructure and mechanical properties of AZ80 magnesium alloy were studied. The experimental results show that the optimal process of solution treatment for AZ80 alloy is heated at 420°C for 5h, which the β phase dissolve thoroughly into the α substrate. After first-stage ageing treatment, the hardness of samples varied as the ageing temperature, and had higher hardeness at temprature 180°C. While in the second-stage ageing treatment, the sample got the ageing peak value at 210°C for 10h. After two-stage treatment, the grains of AZ80 magnesium alloy became homogeneous and fine, and the second phase distributes along the grain boundary and plays an important role of dispersion strengthening. Above all, the optimal heat treatment process of AZ80 magnesium is solution treated at 420°C for 5h, as well as ageing at 180°C, 4h and 210°C, 10h.