The microstructure evolution and mechanical properties of biodegradable Mg-3Sn-1Zn-0.5Mn alloys were investigated by the optical microscopy, X-ray diffractometer and a universal material testing machine. The corrosion and degradation behaviors were studied by potentiodynamic polarization method and immersion test in a simulated body fluid (SBF). It was found that the as-extruded Mg-3Sn-1Zn-0.5Mn alloy has the fine equiaxed grains which underwent complete dynamic recrystallization during the hot extrusion process, with the second phase particles of Mg2Sn precipitated on the grain boundaries and inside the grains. The tensile strength and elongation of as-extruded Mg-3Sn-1Zn-0.5Mn alloys were 244?±?3.7?MPa and 19.3%?±?1.7%, respectively. The potentiodynamic polarization curves in SBF solution indicated the better corrosion resistance of the as-extruded Mg-3Sn-1Zn-0.5Mn alloy in the SBF solution. Immersion test in the SBF solution for 720?h revealed that the corrosion rate of as-extruded Mg-3Sn-1Zn-0.5Mn alloy was nearly 4?±?0.33?mm/year. The hemolysis rate of as-extruded Mg-3Sn-1Zn-0.5Mn alloy was lower than the safe value of 5% according to ISO 10993-4. As-extruded Mg-3Sn-1Zn-0.5Mn alloy showed good biocompatibility after being implanted into the dorsal muscle and the femoral shaft of the rabbit, and no abnormalities were found after short-term implantation. It was revealed that the as-extruded Mg-3Sn-1Zn-0.5Mn alloy is a promising material for biodegradable implants, which possesses an interesting combination of preferred mechanical properties, better corrosion resistance and biocompatibility.