Grain refinement in AZ31 magnesium alloy has been attempted by hot-rolling and annealing process. Specimens were solution heat treated at 673 K for 36 ks, then hot-rolled at 423 - 773 K with total reduction of 20 - 80 % by multi pass process. The rolled specimens were annealed at 473 - 673 K for 3.6 ks. Grain sizes after the solution heat treatment were about 20 to 150 mum. After hot-rolling at 573 K and annealing at 473 K, grain sizes decreased into about 5 to 10 mum. Suppression of grain growth by pinning due to precipitates was observed by transmission electron microscopic observations.