Rare-earth-containing　Mg　alloys　are　a　group　of　widely　investigated　alloys　due　to　the　disperse　nano-sized　precipitations　formed　during　heat　treatment.　The　underlying　formation　and　strengthening　mechanisms　of　precipitation　is　critical　for　their　industrial　applications.　In　this　work,　we　systematically　studied　the　evolution　of　precipitations　in　a　Mg-10Gd　alloy,　based　on　the　atomic-scaled　TEM　and　HAADF-STEM　observations.　Especially,　the　in-depth　transition　mechanism　from　G.P.　Zone　to　beta＂,　beta＇,　beta(T)　and　beta(M)　is　proposed,　as　well　as　their　relationships　with　mechanical　properties.　It　is　found　that　blocking　effect　of　precipitations　improves　the　strength　significantly,　according　to　the　Orowan　mechanism.　The　elliptic　cylinder　shaped　beta＇　phase,　with　a　base-centered　orthorhombic　lattice　structure,　provides　significant　strengthening　effects,　which　enhance　the　hardness　and　ultimate　tensile　strength　from　72　HV　and　170　MPa　to　120　HV　and　300　MPa.