The effects of Sr additions (0.3, 0.6 and 0.9 wt%) on the microstructural evolution, thermal stability, and mechanical properties of a cast Mg–4Zn alloy were investigated. The extent of grain growth and stability of the intermetallic compounds were studied by optical and scanning electron microscopy (SEM), respectively. Mechanical properties of the studied alloys were evaluated by shear punch testing (SPT) method and also the hardness test. Hardness and shear strength of the base alloy were increased by Sr additions in the as-cast condition, due to the grain refinement effect of Sr and also presence of the Sr-containing Mg17Sr2 and Mg70Zn25Sr5 precipitates. However, the optimum amount of Sr was determined to be 0.3 wt%, above which no further improvement in the shear strength of the as-cast alloys was observed, due to the coarsening of the precipitates. The obtained microstructural results indicated that while both of the base and Sr-containing alloys have appropriate thermal stability at 330 °C, the grain size of the base alloy increased significantly and also the Mg4Zn7 particles were dissolved in the matrix after annealing treatment at 400 °C for 96 h, resulting in considerable decrease in the shear strength. However, grain growth was trivial in the Sr-containing alloys, due to the presence of thermally stable Mg17Sr2 particles. Accordingly, the Sr addition was found to be beneficial to improve the stability of the microstructure and mechanical properties of the Mg–4Zn alloy.