A new continuous severe plastic deformation (SPD) method called accumulative back extrusion (ABE) was employed to fabricate ultra-fine grained AZ31 Mg alloy. Microstructures of AZ31 alloy processed by ABE up to four passes at a temperature of 230 °C were investigated using field emission scanning electron microscopy (FESEM). The results showed that the initial average grain size of 25 µm was reduced to about 1 µm. It was also found out that the more passes gave more homogenous microstructure. In addition, in order to ﬁnd the effect of grain size on the mechanical properties, micro-tension tests were carried out and the changes in the yield and tensile strength and fracture elongation were analyzed. The obtained tensile properties were discussed relying on the characteristics of as-processed microstructures.