This study was conducted to compare the development of microstructures of Mg-3.6Zn and Mg-3.6Zn-0.4Ca alloys (in wt%) tested in uniaxial compression (UC) at 200-280 °C with strain rates ranging from 0.001 s−1 to 1 s−1. The stress-strain curves with average values of the flow stress slightly higher in the ternary alloy than in the binary alloy exhibit the typical features of dynamic recrystallization (DRX). Microstructure analyses showed that the volume fraction and average size of DRX grains increase with increasing temperature, and a more homogeneous bimodal microstructure is developed. Lower temperatures and lower strain rates initialize deformation-induced precipitation, which results in heterogeneous evolution of the microstructure in the binary alloy. On the other hand, this precipitation controls, via pinning of grain boundaries, the growth of DRX grains and promotes continuous DRX mechanism. The results indicate that the addition of Ca is favorable to recrystallization occurring during the hot deformation process.