The process of repetitive upsetting-extrusion (RUE) was used to achieve severe plastic deformation (SPD) for an as-cast AZ61 magnesium alloy in temperature range of 285-380 ℃. The microstructure and mechanical properties of the as-cast and RUE processed AZ61 alloys were investigated. The results indicated that homogeneous fine-grained structure with mean grain size of 3.5 μm was obtained as the accumulated true strain in the axial direction increased to 4.28 after three RUE passes at 285 ℃. The dominant reason of grain refinement was considered the dynamic recrystallization induced by strain localization. It was also found that the microstructural evolution was affected by temperature and accumulated deformation. The mechanical properties of RUE processed AZ61 alloys were significantly improved owing to grain refinement. Furthermore, the relationship between deformation parameters and mechanical properties of AZ61 alloy prepared by RUE processing was revealed by tensile tests carried out at room temperature.