The effects of Al, Zr additions on the microstructure and properties of a β matrix Mg-Li-Al-Zr alloy of hot forged, cold rolled and heat- treated states have been systematically investigated. The tensile properties of the alloy was tested, and microstructure was studied by X-ray diffraction and SEM methods. The results showed that the addition of zirconium in the aluminum containing Mg-Li alloy was effective for grain refinement. The alloy containing zirconium of rolled state exhibited higher strength and satisfied ductility compared with the alloy without zirconium. The existence of zirconium in the alloy was mainly in the form of Al-Zr compounds of Al2Zr andAl3Zr. The reason for less age-hardening effect may be caused by the capture of aluminum by zirconium and as a consequent by the lake of aluminum in the matrix.