For achieving flame-retardant AZX912 magnesium alloy with superior mechanical properties, cast ingots were solution-treated at different temperatures of 420–525 °C prior to extrusion at 280 °C. With increasing solution treatment temperature, brittle Al2Ca intermetallic compound changed from a network-like morphology to a spheroidized shape, with an increase in hardness and became unbroken during extrusion. As the solution treatment temperature increased, cracking of Al2Ca particles during tensile deformation tended to be restricted due to hardening and spheroidizing behaviors, and tensile elongation of extruded alloys significantly enhanced from 11.2 to 19.2%. High mechanical strength was maintained with an improvement in ductility when increasing the solution treatment temperature up to 510 °C. The extruded alloy solution-treated at 510 °C exhibited a superior balance between mechanical strength and ductility, with a high ultimate tensile strength of 367 MPa and a good elongation of 16.8%.