Hot deformation behavior of the extruded Mg-6Gd-3Y (GW63) and Mg-6Gd-3Y-1Ag (GW63-1Ag) alloys was assessed by shear punch testing (SPT) method in the temperature range of 623 K to 723 K and shear strain rate of 1.6 x 10(-2)to 1.3 x 10(-1) s(-1). Microstructural examinations showed that Ag addition decreased the initial grain size from 10.1 to 2.9 mu m. According to the hot deformation results, hyperbolic-sine exponents (n-values) of 3.39 and 2.54 were obtained for the Ag-free and Ag-containing alloys, respectively. The corresponding activation energies were found to be 321 and 178 kJ mol(-1)for these alloys. Therefore, the controlling deformation mechanisms were defined as viscous glide of dislocation for the Mg-6Gd-3Y alloy and grain boundary sliding for Mg-6Gd-3Y-1Ag. Processing maps were developed based on the dynamic material model (DMM) to determine the flow instability domains during hot deformation. Accordingly, the optimum hot working conditions were found to be in the temperature range of 655 K to 723 K and shear strain rate of 3.3 x 10(-2)to 1.3 x 10(-1) s(-1)for the GW63-1Ag alloy, whereas the safe deformation window for the GW63 alloy was narrowed down to a temperature range of 665 K to 705 K and shear strain rate of 7.2 x 10(-2)to 1.3 x 10(-1) s(-1). The Ag-containing alloy exhibited flow instability regions only at low temperatures and high strain rates. On the other hand, the Ag-free alloy demonstrated other instability domains comprising the formation of mechanical twins and cracking. Electron back-scattered diffraction analysis was utilized to correlate the microstructural evolution of the alloys after shear deformation to the hot working parameters. Continuous dynamic recrystallization was suggested as the main mechanism for generation of the dynamically recrystallized grains during hot deformation of both alloys.