Two magnesium alloys with the nominal compositions of Mg-6Gd-3Y (GW63) and Mg-6Gd-3Y-1Ag (GW63-1Ag) were hot extruded and then processed by 6 passes of the simple shear extrusion (SSE) process at 553 K. Both SEM and EBSD studies confirmed the mean grain size reduction of the extruded base GW63 alloy from 10.1 to 2.9 mu m by adding 1 wt% Ag. This decrease in the grain size was due to the formation of the Ag-containing precipitates with network-type morphology at the grain boundaries of the extruded GW63-1Ag alloy. Further grain refinement was achieved after SSE through the occurrence of DRX in both Ag-free and Ag-containing alloys. However, the GW63-1Ag alloy showed a higher fraction of DRX grains and HAGBs after SSE processing compared to the Ag-free alloy. The enhanced DRX behavior was attributed to the smaller initial grain size of the Ag-containing alloy in the as-extruded condition and the role of Ag addition in suppressing the solute drag effect of the segregated Gd and Y elements at the grain boundaries. The superplastic behavior of the alloys was assessed via the shear punch testing (SPT) method performed in the temperature ranges of 623-723 K for the extruded specimens and 573-673 K for the SSE processed alloys. It was revealed that none of the extruded alloys exhibited superplastic flow, because of their large grain sizes. The GW63 alloy processed by 6 passes of SSE displayed a maximum m-value of 0.38 at 648 K, while the high strain rate sensitivity (SRS) index of 0.5 was measured at 623 K for the Ag-containing alloy after SSE. This was accompanied with a superplastic deformation behavior of the latter alloy, for which an activation energy of 105 kJ mol(-1) that is close to that of the grain boundary diffusion of pure Mg was obtained. Therefore, grain boundary sliding (GBS) associated with grain boundary diffusion was introduced as the dominant deformation mechanism during the superplastic flow of the Ag-containing alloy processed by SSE.