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During thixomolding ® of Mg alloys, fine grains (size of ∼ 10 μm) and continuous eutectic compounds are formed along grain boundaries. These compounds are partly responsible for the superior creep strength of Mg alloys. In this study, we investigate the effects of eutectic compounds formed along grain boundaries in thixomolded ® Mg 96 Zn 2 Y 2 on creep deformation at 573 K. By performing microstructure analyses, we find that two types of continuous eutectic compounds―Mg 3 Y 2 Zn 3 and Mg 12 YZn―are formed in the alloy. The strain rate of Mg 96 Zn 2 Y 2 is about two orders of magnitude lower than that of a heat-resistant alloy Mg 93 Al 5 Ca 2 (Mg-6 mass%Al-3 mass%Ca) at 573 K. The stress exponent n at 573 K is approximately 7, and it is considered that creep deformation is controlled by dislocation motion. All scribe lines produced on a specimen of Mg 96 Zn 2 Y 2 are curved. Furthermore, in the case of a specimen with a creep strain of 7%, no abrupt steps are observed at grain boundaries and interfaces between the α-Mg matrix and eutectic compounds. Our results indicate that eutectic compounds formed along grain boundaries are effective in suppressing grain boundary sliding.