Parallel modes of precipitation mechanisms in an Mg-Nd alloy were revealed by examining an isothermally annealed high pressure die cast alloy at 177 A degrees C for up to 100 h. Broadly, precipitate evolution was observed to occur concurrently on dislocations and within the surrounding alpha-Mg matrix. However, it was observed that the presence of dislocation accelerated the precipitate formation kinetics significantly. In contrast to the accepted precipitation pathway in the Mg-Nd system, i.e., SSSS -> GP zones -> beta aEuro(3) -> beta' -> beta(1) -> beta -> beta(e), dislocations were found to preferentially facilitate the formation of beta' and beta(1) precipitates even at the very early stages (5 h) of annealing. Within the same time frame, a homogeneous distribution of Nd-rich pockets was observed throughout the alpha-Mg matrix, along with the beta' and beta(1) precipitates decorating dislocation lines. Results further indicate that these Nd-rich regions initiated precipitation within the parent alpha-Mg matrix. The formation of these Nd-rich pockets was explained on the basis of a miscibility gap in the alpha-Mg phase at 177 A degrees C. Our results demonstrate that the presence of dislocations influence strongly the phase-transformation pathways in Mg-rare earth alloys by facilitating the formation of selective precipitate phases.