In present work, trace elements Sr and Nd were added into AZ91-1wt%Si alloys. The alloys were cast into a permanent mould and then machined into test bars. The microstructure and mechanical properties at room temperature of the specimens were investigated. Results showed that complicated Chinese script Mg2Si phase decreased in size with the increase of Sr addition. When Sr addition increased to 0.1wt%, the Mg2Si phase was changed from Chinese script shape into uniform polygon shape completely. At the same time, mechanical properties improved due to the morphology modification of the Mg2Si phase. An intermetallic compound containing Mg, Al, Nd and Si was found when Nd was added to the alloy. Remarkable modification on the shape and distribution of the Mg2Si phase was observed because of the intermetallic compound, which leads to a great change in mechanical properties. The grain refinement mechanism of Sr and Nd elements on the Mg2Si phase was discussed.