The effects of rare earth yttrium (Y) additions and the heat treatment process on the microstructure and mechanical properties of as-cast ADC12 aluminum alloy have been investigated. The results showed that the primary Si crystals were significantly refined from long axis to fibrous or granular when the Y content was 0.2 wt%. Compared to the matrix, the mean area and aspect ratio were decreased by 92% and 75%, respectively. Moreover, the Si and Fe-rich phases were spheroidized and refined with a small average size during the solid solution. It was also noted that the copper-rich phases were dissolved into the matrix. Correspondingly, it was found that after metamorphic and heat treatment the ultimate tensile strength (UTS), elongation, and, hardness increased by 81.9%, 69.7%, and 74.8%, respectively, compared to the matrix. The improved mechanical properties can primarily be attributed to the optimization of the microstructure and the refinement of various phases.