A method of pre-regulating the lamellar long-period stacking ordered (LPSO) phase was introduced to enhance the hot plasticity of rare earth magnesium alloys. Additionally, low-temperature extrusion was used to achieve a comprehensive improvement of alloy performance with small deformation, providing a new approach for the preparation of high-performance large components. The strengthening−toughening mechanism under low-temperature extrusion with an extrusion ratio of 3.6꞉1 was investigated by comparing the microstructure and performance of pre-regulated Mg−Gd−Y−Zn−Zr alloy at three different extrusion temperatures (420, 450, and 480 °C). Results show that the alloy extruded at 420 °C exhibits a yield strength of 341 MPa, tensile strength of 419 MPa, and elongation of 7.2%. The increase in strength is mainly caused by the strong texture and internal dislocation pinning of the undynamic recrystallization (un-DRX) zone, and a lower volume fraction of β dynamic precipitation phase is beneficial to improving the ductility of the alloy.