Abstract Usage of magnesium alloys constantly increase, especially in the area of automotive industry. Classification of magnesium alloys for forming, production process by rolling, extrusion and forging have been presented. Moreover, the difficulties in magnesium manufacturing have been presented as well. The relations between microstructure and deformation parameters in AZ31 magnesium alloy have been studied. Two main deformation processes: twinning and slipping have been shown. The changes in the plastic characteristics as a function of the Zener-Hollomon parameter have been presented. The research carried out enabled the understanding of the phenomena taking place during deformation and annealing of the investigated AZ31 type alloy. The results will constitute the basis for modelling the structural changes.