Magnesium alloys are a strong candidate for various applications in automobile and aerospace industries due to their low density and specific strength. Micro-alloying magnesium with zinc, yttrium, and cerium enhances mechanical properties of magnesium through grain refinement and precipitation hardening. In this work, a critical review of magnesium-based binary systems including Mg-Zn, Mg-Y, Mg-Ce, Zn-Y, and Zn-Ce is presented. Based on the CALPHAD approach and first-principles calculations, thermodynamic modeling of Mg-Zn-Y and Mg-Zn-Ce ternary phase diagrams have been summarized. The influence of micro-alloying (yttrium and cerium) on the mechanical properties of magnesium is discussed. A comparison between mechanical properties of magnesium commercial alloys and magnesium–zinc–{yttrium and cerium} have been summarized in tables.