In this study, a novel friction stir extrusion (FSE) process is investigated for fabrication of fully-consolidated wires. The process parameters of rotational speed (RS), plunge rate (PR), and extrusion hole size are optimized using the Taguchi L8 orthogonal design of experiments. The optimum process parameters are determined with reference to the average grain size of the wire. The analysis of variance shows that the RS of plunge die is the most dominant factor in deciding the soundness of joint, while PR also plays a significant role. The microstructural studies reveal that initial grains of Mg ingot undergoes significant refinement in the specimens produced by the FSE process. Mechanical tests show that almost all recycled specimens can achieve higher strength and elongation than parent material at room temperature. This study shows that defect free, high quality wires can be produced using a proper combination of process parameters and recommends parameters for producing the best wire properties.