Dynamic recrystallization behavior of Mg-3.1wt.%Al-0.1wt.%Y alloy was investigated. During extrusion, dynamic recrystallization occurred and very fine microstructure was obtained. We compared the relationship between Zener-Hollomon parameter, Z, and the dynamically recrystallized grain size, drec, and between the normalized recrystallized grain size, drec/d0, where d0 is the initial grain size, and Z for Mg-3.1wt. %Al-0.1wt.%Y with commercial Mg-3Al-0.5Zn alloy. As the result, the dynamically recrystallized grain size of Mg-3Al-0.1Y was finer than that of Mg-3Al-0.5Zn alloy under the equivalent Z, while the initial grain size of Mg-3Al-0.1Y was coarser than Mg-3Al-0.5Zn alloy. The normalized grain size for Mg-3Al-0.1Y alloy was much smaller than that of Mg-3Al-0.5Zn alloy under the equivalent Z. We conclude that small addition of Y to Mg-Al alloys is effective for grain refinement by dynamic recrystallization.