To investigate the hot deformation behaviour of Al-3%Mg2Si, isothermal compression tests were carried out in the temperature range of 300–500 °C and strain rate range of 0.01–5 s−1. The deformed microstructures were characterized by optical microscope, scanning electron microscope, transmission electron microscope and electron backscatter diffraction. The results show that the flow stress curves reveal a typical dynamic recovery characteristic. A modified Arrhenius-type constitutive equation was built to describe the flow behaviour of Al-3%Mg2Si alloy. Furthermore, based on the processing map of Al-3%Mg2Si alloy established under the strain of 0.8, microstructure evolution was analyzed. The high efficiency of power dissipation regions is mainly due to the softening mechanism of dynamic recovery and partial dynamic recrystallization. Mg2Si particles also play a positive role in dynamic recrystallization. The damage mechanism of unstable domains is the fracture and debonding of Mg2Si particles.