The microstructure and mechanical properties of flame-resistant AZX912 magnesium alloy extruded at different temperatures in the range of 250–400 °C were investigated. With decreasing extrusion temperature from 400 °C to 250 °C, the grain size of dynamically recrystallized grains significantly decreased from 13.6 to 1.8 µm, and the amount of fine Mg17Al12 precipitates, with sizes of 50–200 nm, increased due to dynamic precipitation. The extrusion texture, with the basal plane and <> direction, mostly parallel to the extrusion direction, was remarkably strengthened as the extrusion temperature increased. This may be attributed to the enhanced activity of the prismatic slip. Nanoscale Mg17Al12 precipitates significantly enhanced the mechanical strength, but deteriorated the ductility. The bar extruded at 250 °C exhibited the highest mechanical strength, which was due to the combined effect of the remarkably refined grain structure and the large amount of nanoscale Mg17Al12 precipitates. The extrusion at 400 °C resulted in the lowest tensile elongation, which was attributed to both grain coarsening and basal texture strengthening. The bar extruded at 300 °C exhibited a good balance between mechanical strength and tensile ductility.