Strip casting is a promising route to directly produce magnesium alloy sheet by twin roll casting method. As-cast strips with proper microstructure and good surface quality are requested to serve as next rolling feedstock. In order to restrain the coarse dendrite growth and get uniform grain, a new method of in-line heat treatment was proposed. The as-cast strip was dipped into an oil tank after exiting the rolls and then was quenched with oil at various temperatures. The effect of oil temperature, casting speed and pouring temperature on microstructure and mechanical properties of cast strip was investigated.