The microstructure and mechanical properties of Mg-3wt％Nd-0.2wt％Zn-0.4wt％Zr alloy in as-cast, solution-treated and solution-treated + peak-aged were investigated. The alloy had a cast structure with large intergranular Mg12Nd phase between the α-Mg matrix. After solution-treated, the intergranular Mg12Nd phase disappeared and lots of small Zr-containing particles distributed inside the grains. Small plate-like phases precipitated inside the grains strengthened the alloy to a high level after peak-aged at 200°C for 16 hours: the ultimate strength of the alloy up to 305 MPa, with considerable elongation rate 11%, and yield strength 140 MPa. The peak-aged samples also had good creep resistance, with strain rate less than 0.2% after 120 hours creep test under the condition of 110 MPa at 200°C. The minimum creep rate was about 4.64×10-9. The alloy had different fracture pattern in different states: as-cast state, intergranular fracture was the key pattern to failure; after solution-treated, the fracture pattern turned to cleavage transgranular fracture; after peak-aged, the alloy had a mixed fracture pattern of transgranular and intergranular, in which transgranular was the main style.