The clinical application of magnesium (Mg)-based alloys as temporary orthopedic implants is highly limited by their rapid corrosion rate in the physiological environment. Herein, an anti-corrosive polymeric coating based on polycaprolactone (PCL) and lawsone was prepared on AZ31 Mg alloy to improve its corrosion resistance. Lawsone was incorporated into the coating as a corrosion inhibitor to enhance the passive corrosion protection of the PCL coating through its strong chelation ability of dissolving Mg2+. Anti-corrosion properties of the coatings were assessed by electrochemical techniques and in vitro immersion tests, and the results demonstrated a remarkable improvement in corrosion resistance of the bare Mg alloy. In addition to the corrosion inhibition effect, incorporation of lawsone provided the coating with a strong antibacterial activity against Escherichia coli and Staphylococcus aureus bacterial strains. Moreover, the fabricated coating was cytocompatible (viability of > 85 %) toward human fetal osteoblast cells. The findings of this work highlighted the great potential of lawsone as a natural corrosion inhibitor for fabrication of corrosion protective, antibacterial, and biocompatible coatings on Mg-based biodegradable implants.