In this paper, microstructure and fracture behavior of Al‐Si‐Mg alloy prepared with recycled alloy were studied. The results show that some casting defects such as oxidation slags, pores and iron‐rich intermetallic phases exist in the alloy prepared with recycled alloy. Stress concentration forms in the tips of the pores and iron‐rich intermetallic phases in the process of stretching. Cracks are easy to initiate near slags due to the weakening of the adhesion between the oxidized slag and the aluminum matrix. In addition, silicon phases play a hindering role on the movement of dislocations in the process of crack propagation and merging of cracks which is strengthening the alloy prepared with recycled alloy to some extent. Crack propagation is mainly along the direction of casting defects, and the cracks connect with each other until failure of material. Moreover, the crack originate from silicon phase and extend along the eutectic structure of alloy no‐containing recycled alloy, and a large plastic deformation occurred in the α‐aluminum dendrites.