In order to improve the performance of magnesium (Mg) for resorbable implant applications, Mg-1Zn-2Dy alloy was developed and the surface of the alloy has been modified by melting using lasers. Laser melted samples, at different laser energy density, were then subjected to microstructural, hardness, wettability and in-vitro degradation assessment. The microstructure of the Mg-Zn-Dy alloy mainly consisted of alpha-Mg and eutectic phase (Mg8ZnDy). The melted region of the alloy surface evolved with fine grain microstructure at the near surface region and columnar grains near to the liquid solid substrate. The degree of grain size refinement obtained at the melted zone in the order of 1-2 mu m. The cross sectional microhardness of the modified zone was measured by Vickers microhardness tester. Due to these microstructural refinements and solid solution strengthening the surface hardness of laser treated alloy increased by two-fold. It was found that as the energy density increased the surface roughness along with the surface energy also increased. The wetting behaviour of the surface was estimated through measuring the contact angle by dropping the polar and non-polar liquid. Results showed that the surface energy is also found to change with LSM due to changes in the surface morphology, microstructure and chemical composition of the material. The detailed degradation study was carried out by immersing the samples in hanks balances salt solution (HBSS). The improvement in the degradation behaviour followed by laser surface melting is related to the microstructural refinement as a result of rapid heating and cooling of the melted zone.