Magnesium samples reinforced with 0.7, 1.4, and 2.4 vol.% of Inconel 718 particles were prepared using a disintegrated melt deposition technique followed by hot extrusion. Mechanical properties, thermal expansion, and damping were studied with the aim of revealing the particle influence on the microstructure, texture, tensile and compressive behavior, thermal expansion coefficient, and internal friction. The flow stresses are significantly influenced by the test temperature and the vol.% of particles. A substantial asymmetry in the tensile and compressive properties was observed at lower temperatures. This asymmetry is caused by different deformation mechanisms operating in tension and compression. The fiber texture of extruded composite samples, refined grain sizes, and the increased dislocation density improved the mechanical properties. On the other hand, a decrease in the thermal expansion coefficient and internal friction was observed.