Microstructure, mechanical properties and bio-corrosion properties of Mg–3Zn–0.2Ca alloys were investigated for biomedical application by optical microscopy (OM), scanning electronic microscopy (SEM), mechanical properties testing, electrochemical and immersion measurement, with the as-cast of this alloy as control. The XRD showed that the main second phases in the cast alloy were Mg-Zn intermetallic compounds such as Mg7Zn3, Mg2Zn3, and Mg4Zn7. In comparison with the cast alloy, the average grain size of the extruded Mg–3Zn–0.2Ca alloy was significantly decreased by 47.6 times from 119.1μm to 2.5μm after extrusion ratio 56:1. The yield tensile strength (0.2%YS), ultimate tensile strength and elongation of the extruded alloys were 205MPa, 336MPa and 17.85%, respectively. The electrochemical and the immersion tests showed that the corrosion resistance of the extruded alloy was obviously higher than that of the cast alloy due to the fine grained microstructure. The new designed Mg–3Zn–0.2Ca alloy showed the good combination of mechanical performance and corrosion resistance for biomedical application.