The effects of Bi modification and ultrasonic treatment (UST) on the microstructure and mechanical properties of AlMg5Si2Mn alloy were investigated. Compared to the alloy without any treatment, the eutectic Mg2Si phases are refined effectively by Bi addition, and its morphology is changed from the mazelike thick lamellars for the base alloy to thin coralline fibers for the containing Bi alloy. The modification of eutectic Mg2Si phase is attributed to the Bi segregation and composition supercooling in front of the growing Mg2Si phase. UST can assist modification of Bi on the eutectic Mg2Si phase and change the morphology of the primary α-Al phase in the AlMg5Si2Mn alloy from coarse dendrites to small near-spherical equiaxed crystals, meanwhile, which can also promote the homogenization of the treated melt and uniform distribution of Bi atoms or clusters in the melt. Moreover, the yield strength, ultimate tensile strength and elongation of the alloy modified by 0.3% Bi addition combined with UST at 660 °C are obviously enhanced, and the fracture modes of the alloys are changed from brittleness to toughness.