Effects of extrusion on mechanical properties and damping capacity of Mg-1.8wt.%Cu -0.5wt.%Mn (MCM1805) alloy have been investigated. Tensile tests and dynamic mechanical analyzer were respectively used to measure tensile properties and damping capacity at room temperature of as-cast and as-extruded MCM1805 alloy. The microstructure was studied using optical microscope, X-ray diffraction and scanning electron microscope with an energy dispersive X-ray spectrometer. Granato-Lücke model was used to explain the influences of extrusion on damping capacity of MCM1805 alloy. The results showed that extrusion dramatically decreases the grain size but has little influence on phase composition and solute atoms concentration of MCM1805 alloy, and the grain refinement was the dominant reason for the obvious increase of tensile properties and decrease of internal friction of MCM1805 alloy.