Less solid-solution of Ag strengthens the Mg-5Sn alloy more effectively. Ag additions improve the peak-aged hardness of Mg-5Sn alloy proportionally. Ag additions enhance the precipitates density proportionally in the peak-aged alloys. Solid solution of retained Ag also contributes to the peak-aged hardness increase. Mg54Ag17 precipitates with new orientation relationship exist in Mg-5Sn-2Ag alloy.