The microstructural and magnetic properties of Zn-substituted Li-Mg ferrites having the general formula LixMg0.4Zn0.6-2xFe2+xO4 (where x = 0, 0.05, 0.1, 0.15, 0.2, 0.25 and 0.3) have been investigated as a function of composition and temperature. The SEM studies show that the average grain diameter initially increases to 2.66 mu m with Zn content up to 0.3 and then decreases beyond this limit. The magnetic moment (mu(B)) initially increases up to Zn = 0.3 and then decreases with further increase in Zn content. The initial permeability in the same way increases but up to 0.3 and then decreases. The variation of normalized a.c. susceptibility with temperature indicates that the sample with Zn = 0 possess single domain (SD) type of magnetic particles whereas those with Zn = 0.1 to 0.5 and beyond Zn = 0.5 showed multidomian (MD) and superparamagnetic (SP) natures, respectively. The Curie temperatures obtained from mu(i)-T and chi-T curves indicate that T-c goes on decreasing linearly with addition of Zn.