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Environmental gains of electric cars can be optimized with the use of lightweight and recyclable magnesium in the vehicle’s structural components. Ductility improvement of low-density Mg-Al alloys will extend their use in automotive body applications. The authors achieved 63% ductility improvement in Mg-6wt%Al with trace Y (1.5 ppm) due to the β-phase refinement and predicted that higher levels would not perform as well. As predicted, 0.3wt% of Y addition investigated in this study led to lower mechanical performance and β-phase refinement than those obtained with trace additions. The tensile ductility and yield strength increased by ~13% and 16%, respectively, and the compression strain to fracture by ~22%. Scanning electron and optical microscopy, X-Rays diffraction, mechanical testing and thermodynamic calculations were used to investigate the effect of 0.3wt% Y on the microstructure of Mg-6wt%Al. The matrix dissolution revealed the close association of the Al2Y and the β-Mg17Al12 phases.