For the Magnesium alloy AZ31, hot rolling is usually carried out in the temperature range between 250 and 400°C but the processed sheets usually exhibit high anisotropy in mechanical properties. In the current study, DSR process was found to be effective in improving anisotropy of mechanical properties and ductility at room temperature. Full recrystallization takes place from 200°C and above. A large drop of UTS occurs above 200°C where full recrystallization starts. Tensile elongation increases with annealing temperature but anisotropy degrades from 200°C onwards. Texture change during recrystallization is believed to be responsible for this result.