The Mesoalite alloy is formed using rapidly solidified powder metallurgy (RS-P/M) by hot extruding the RS powder produced by the atomization method. Meso20 is a Mesoalite alloy with a chemical composition of Al-9.5Zn3Mg-1.5Cu-4Mn-0.04Ag (mass%). Meso20 contains fine grains and precipitated intermetallic Mn compounds, and has a tensile strength of 910 MPa. During hot extrusion, dynamic recrystallization occurs and the fine grains develop. During heat treatment of Meso20, rod-like and granular Mn intermetallic compounds precipitate. The rod-like compounds are about 1 Im in length and the granular compounds are about 1 Im in diameter. X-ray diffraction measurement transmission electron microscopy and energy dispersive X-ray (TEM/EDX) analysis and Rietveld analysis revealed the chemical composition of the granular and rod-like Mn intermetallic precipitates to be 86.5Al-10.9Mn-0.4Cu-0.9Zn-1.3Mg and 80.5Al-10.3Mn-4.2Cu-2.5Zn-2.5Mg (mass%), respectively. The granular and rod-like compounds were identified as the Al6Mn and Q phases, respectively, with both belonging to the space group Cmcm. The lattice constants of Al6Mn were a=0.754 nm, b=0.648 nm c=0.855 nm and those of the Q phase were a=0.765 nm b=2.34 nm c=1.25 nm. Meso10, with a chemical composition of Al-9.5Zn-3Mg-1.5Cu-0.04Ag (mass%), contains no Mn and does not have fine grains, but rather coarse fibrous grains elongated along the extrusion direction. Thus the Mn intermetallic precipitates in Meso20 clearly affect the formation of fine grains. Microstructure development was studied during hot extrusion by observation using high resolution Electron Back Scattering Pattern method. Fine grains were found to develop in areas, which were relatively abundant in granular Mn intermetallic precipitates.