The AZ31 Mg alloy thin sheets were hot-rolled by using a small-sized rolling mill. The thickness was successfully reduced to 0.6 mm without surface crack in 150mm×50 mm area. The effect of rolling deformation on microstructure of the thin sheets was investigated. The basic α-Mg phase preferred on (0001) plane and had equiaxed grains with an average grain size of about 20 μm. All cross sections parallel to the rolling direction showed a streamline-like microstructure due to the strong working strain during hot rolling. The precipitates were remarkably refined to less than 5 μm.