The combined effect of extrusion and multi-directional forging (MDF) was investigated on microstructure and mechanical properties of aluminum-based composite with 10, 15, and 20 wt% Mg2Si. In the casted Al–Mg2Si composites, the primary and eutectic Mg2Si particles are generally coarse which lead to decreasing their mechanical properties and formability. Extrusion process was utilized to overcome this shortcoming by breakage of the eutectic structure, reduction of Mg2Si size, and the decrease of casting defects. Then, MDF process was applied up to failure on the extruded composites at room temperature. It led to the morphological modification of primary and eutectic Mg2Si phases and the reduction of their size. It was found that the MDF process resulted in a considerable improvement in hardness and shear strength of materials. This may be related to the reduction in the average size of Mg2Si particles with their uniform distribution. In addition, ultimate shear strength is, respectively, increased from 94, 99, and 81 MPa to 119, 116, and 117 MPa for the 10, 15, and 20 wt% Mg2Si aluminum composites after the final pass of MDF. Meanwhile, the normal displacement of composites is reduced at initial passes and increased by the addition of more pass numbers.