The stability and bonding mechanism of ternary magnesium based hydrides (Mg, X, Y)H-2, X or Y = Fe or Ni, were studied by means of electronic structure and total energy calculations using the FP-LAPW method within the GGA. The influence of the selected alloying elements on the stability of the hydride was determined from the difference between the total energy of the alloyed systems and those of the pure metal and the hydride. Full relaxation was carried out against the overall geometry of the supercell and the internal coordinates of the H atoms. The bonding interactions between the alloying atoms and their surrounding H atoms were estimated using the variation of the total energy against the coordinates of H atoms. The alloying elements, Fe and Ni, destabilised MgH2. This combined with the weak bonds between the alloying elements and H atoms improved the dehydrogenation properties of MgH2. (C) 2008 International Association for Hydrogen Energy. Published by Elsevier Ltd. All rights reserved.