A Mg-8%Al-1%Si alloy with semisolid microstructure was fabricated by isothermal heat treatment process. The effects of isothermal process parameters such as holding temperature and holding time on the microstructure of Mg-8%Al-1%Si alloy were investigated. The results show that a non-dendritic microstructure could be obtained by isothermal heat treatment. With increasing holding temperature from 560 to 575 °C or holding time from 5 to 30 min, the liquid volume fraction increases, the average size of α-Mg grains grows larger and globular tendency becomes more obvious. In addition, the Mg2Si phase transforms from Chinese script shape to granule shape. The morphology modification mechanisium of Mg2Si phase in Mg-8%Al-1%Si alloy during the semisolid isothermal heat treatment was also studied.