To provide a highly workable magnesium alloy having excellent hot workability and mechanical properties, and to provide a method for producing the same.

The highly workable magnesium alloy has a composition comprising, by weight, 3.60 to 8.50% Al, 0.05 to 2.50% Zn, 0.01 to 0.80% Mn, ≤0.03% Si, 0.01 to 0.50% Ca, ≤0.005% Fe, ≤0.005% Ni, ≤0.005% Cr, ≤0.008% Cu and ≤0.005% Co, and the balance Mg with inevitable impurities, and in which the average crystal grain size of a matrix is <50 μm and the average grain size of intermetallic compounds is ≤20 μm. The production method uses the same.