The hot deformation behavior and dynamic softening mechanism of 7B50 aluminum alloy were studied via isothermal compression experiments in the range of 320–460 °C/0.001–1.0 s−1. According to the flow curves obtained from the experiments, the flow behavior of this alloy was analyzed, and the Zener–Hollomon (Z) parameter equation was established. The hot processing maps of this alloy were developed based on the dynamic material model, and the optimal hot working region was determined to be 410–460 °C/0.01–0.001 s−1. The electron backscattered diffraction (EBSD) microstructure analysis of the deformed sample shows that the dynamic softening mechanism and microstructure evolution strongly depend on the Z parameter. Meanwhile, a correlation between the dynamic softening mechanism and the lnZ value was established. Dynamic recovery (DRV) was the only softening mechanism during isothermal compression with lnZ ≥ 20. Discontinuous dynamic recrystallization (DDRX) becomes the dominant dynamic recrystallization (DRX) mechanism under deformation conditions of 15 < lnZ < 20. Meanwhile, the size and percentage of DDRXed grains increased with decreasing lnZ values. The geometric dynamic recrystallization (GDRX) mechanism and continuous dynamic recrystallization (CDRX) mechanism coexist under deformation conditions with lnZ ≤ 15.