The effects of rare earth addtition of Er on the microstructures and mechanical properties of Mg-9Zn-Zr magnesium alloys were examined. The results showed that the addition of Er resulted in the formation of two types of thermally stable Er-bearing compounds with distinct Zn/Er ratio. The volume fraction of the second-phase particles increased with the increase of Er addition. 2% Er could refine the as-cast microstructure effectively. The yield strength generally increased and the elongation decreased gradually. 0.5% Er-bearing alloy had optimum combined mechanical properties, with the yield strength, tensile strength and elongation being 313MPa, 366MPa and 22%, respectively. Furthermore, addition of Er brought about homogenous deformation behaviour and recrystallization behaviour to the alloy.