Rare earth–Mg–Ni-based alloys with superlattice structures are new generation negative electrode materials for the nickel metal hydride batteries. Among them, the novel AB4-type superlattice structure alloy is supposed to have superior cycling stability and rate capability. Yet its preparation is hindered by the crucial requirement of temperature and the special composition which is close to the other superlattice structure. Here, we prepare rare earth–Mg–Ni-based alloy and study the phase transformation of alloys to make clear the formation of AB4-type phase. It is found Pr5Co19-type phase is converted from Ce5Co19-type phase and shows good stability at higher temperature compared to the Ce5Co19-type phase in the range of 930–970 °C. Afterwards, with further 5 °C increasing, AB4-type superlattice structure forms at a temperature of 975 °C by consuming Pr5Co19-type phase. In contrast with A5B19-type alloy, AB4-type alloy has superior rate capability owing to the dominant advantages of charge transfer and hydrogen diffusion. Besides, AB4-type alloy shows long lifespan whose capacity retention rates are 89.2% at the 100th cycle and 82.8% at the 200th cycle, respectively. AB4-type alloy delivers 1.53 wt.% hydrogen storage capacity at room temperature and exhibits higher plateau pressure than Pr5Co19-type alloy. The work provides novel AB4-type alloy with preferable electrochemical performance as negative electrode material to inspire the development of nickel metal hydride batteries.