Computer simulation of mechanical behavior of discontinuously reinforced composites containing randomly oriented short-fibers/whiskers presents an attractive opportunity for reduction of the number of experiments and resources required for microstructure design of such advanced materials. It is desirable to perform such simulations using microstructure model that accounts for randomness in angular orientations and locations of the short fibers/whiskers. In this contribution, a methodology is presented for efficient simulation of the required microstructural model through modification of well-known random sequential adsorption (RSA) algorithm for microstructure simulation through its application to the microstructure of Mg–alloy matrix composite containing randomly oriented short carbon fibers. The modified RSA algorithm enhances accuracy and efficiency of the complex geometric details of the randomly oriented short-fiber reinforced composite microstructure. Simulated microstructural model of composite is implemented in abaqus to simulate the mechanical response of the Mg–matrix composite containing randomly oriented short carbon fibers. The generated complex microstructure model in abaqus code is sliced into thin slices for reducing computing resources. The simulated results from multiple sliced models were averaged to approximate the result for the full volume element. The simulated mechanical response by use of multiple sliced models is validated via comparison with the experimental data.