Microstructural evolution and strengthening mechanisms of Mg-3Sn-1Ca based alloys with additions of different amounts of AlN nano-particles were investigated. It was found that with increasing the amount of AlN nano-particles the grain size decreases obviously. The existence of AlN nano-particles could refine the primary crystal phases CaMgSn, which provided more heterogeneous nucleation sites for the formation of magnesium. Moreover, such nano-particles could also restrict the grain growth during solidification. After adding AlN nano-particles, both the tensile properties at room temperature and high temperature 250 °C and the hardness are largely improved. The improvement of strength is attributed to grain refinement and second phase refinement.