A B S T R A C TIn this study, microstructure evolution, textures and mechanical properties of AZ61 magnesium alloy were investigated by optical microscopy (OM), scanning electron microscopy (SEM), transmission electron microscopy (TEM), and tensile tests. The samples were processed by a new compound extrusion (CE) which combines direct extrusion (DE) and two steps of equal channel anger extrusion (ECAE). The results show that CE process can refine the microstructure more effectively than the DE process. The CE-fabricated samples have a weaker texture (0002), and a more fine and homogeneous microstructures, which attributes to the additional two steps of ECAE in CE process. In CE process, twin dynamic recrystallization and rotational dynamic recrystallization occurred, which enhances the refinement of the grains and weakening of the texture. In addition, the samples fabricated by CE process display a higher tensile properties (yield strength, tensile strength and elongation) with an excellent balance of strength and tensile ductility. Based on this study, severe plastic deformation (SPD) techniques combining conventional DE and two steps ECAE into a single process are feasibility to improve the mechanical properties of AZ61 Mg alloy.