In electronic packaging in recent years, silver (Ag) alloy wires have been widely adopted in wire-bond processes. The bond pads on the device chips are mostly aluminum (Al). Thus, the bonding interface is mainly Ag-Al. In recent Ag alloy wirebond publications, it is unclear what intermetallic phases form at the interface. In this research, experiments were designed to understand the Ag-Al intermetallic compound (IMC) formation in the Ag-Al system and evaluate its mechanical properties. First, the Ag-Al alloys with compositions from 19 to 43 at.% Al were evaluated to identify the phase equilibrium and crystal structure of the Ag-Al intermetallic phases. Microstructures and phase compositions of the designed Ag-Al alloys are presented. To further study the intermetallic compound formation at the Ag/Al interface, the interfacial reaction of the Ag/Al joints at 200 °C was investigated. The µ-Ag 3 Al and δ-Ag 2 Al IMC were identified to form at the Ag/Al interface and stabilize after long-time annealing at 200 °C. At last, deformation and fracture behaviors of the bulk µ-Ag 3 Al and δ-Ag 2 Al were analyzed by the micro-indentation. The measured results reveal that µ-Ag 3 Al exhibits significantly higher hardness and lower fracture toughness as compared to δ-Ag 2 Al. Indentation crack propagation in µ-Ag 3 Al demonstrates the fracture characteristics of brittle materials. In the case of δ-Ag 2 Al, the presence of slip bands exhibits the ductility of δ-Ag 2 Al to endure plastic deformation prior to fracture. The effect of the mechanical properties of the µ-Ag 3 Al and δ-Ag 2 Al IMC on the Ag-Al joint reliability is discussed. New information obtained in this research is important for future study of the joint reliability and failure mechanism of Ag-Al wire bonds.