Abstract In this work, the alumina (Al2O3) particles-reinforced AZ61 magnesium (Mg) alloy surface composite was fabricated using friction stir processing (FSP) and groove reinforcement filling methods. The Mg alloy surface composites were developed with and without the addition of Al2O3 reinforcing particles, and their mechanical performance was compared with each other and with unprocessed base metal (BM). The Al2O3 powder was compressed into a groove of 4.5 mm depth that had been created in AZ61 Mg alloy plates. The volume fraction of Al2O3 powder was increased to 5, 10, and 15 vol.% depending on the width of the groove. Results disclosed that the problem of cluster formation of reinforcing Al2O3 particles was minimized by performing FSP in five number of passes. The ultimate tensile strength (UTS) and hardness of AZ61 Mg alloy were enhanced by 6.07 % and 22.23 % when it was subjected to FSP. This is primarily correlated to the significant refining of grains due to the severe plastic deformation associated with FSP. The 15 vol.%-FSPed Al2O3/AZ61 Mg alloy surface composite showed a higher UTS of 630 MPa and hardness of 300 HV. This is due to the integration of a greater quantity of Al2O3 particles with substantial grain refining.