The mechanical behaviour, percolation and damage mechanism of a aluminium alloy with viscous solid grain boundaries (GBs) at 465-degrees-C have been characterized in experiments performed in tension or compression in the strain rate range of 10(-5)-10(-2) s-1. It was found that grain-boundary sliding (GBS) occurs as strain rates below 10(-4) s-1. It was shown that the viscous solid interphase migrates during the process of deformation. In the case of tension, it was squeezed out of GBs parallel with the tension axis into GBs perpendicular to the axis and vice versa in the case of compression. This local percolation is discussed in terms of the viscosity of the interphase, gradient of local stresses and percolation time. The viscosity of the solid interphase is estimated. It was also found that cavitation depends on the type of stress (tension or compression) and the strain rate. Cavity nucleation occurs at multiple points when GBS happens or along GB facets in the absence of GBS. Cavity growth takes place along GBs at high normal stresses and the cavity coalsescence leads to "saw-tooth" fracture.