The mechanical testing for magnesium alloy AM60 was conducted on an MTS servohydrolic material testing system. In order to examine the effects of impact velocity on fracture toughness, finite element method was applied to compute the impact fracture toughness of AM60 specimens with single notched edge at room temperature. The specimens were impacted by steel balls (Diameter 20 mm) at the velocities of 80m/s, 120m/s and 160m/s. The simulation results well described the effects of impact velocities on fracture toughness. The finite element analysis performed in this work offered an effective method to compute dynamic fracture toughness for engineering applications.