The crack that mostly occurs at the heat-affected zone is a major challenge for welded magnesium alloys including AZ91D. This study proposed a new method of laser welding of this alloy assisted with a combination of cryogenic and heat treatment to remedy this problem. It was found that when the new process is used, the crack transformed from heat-affected zone to fusion zone and the tensile strength of the sample were 32.57 % higher than that welded by traditional laser welding. Through studying the changes of hardness, precipitates, and micro-structure in welded joint, it was found that the conversation of Mg17Al12 from dendritic state into short rod state as well as the appearance of dispersed Al8Mn5 particles played a major role in improving the mechanical properties of the welded magnesium alloy. © 2016, Springer-Verlag London.