Cavity or cavitation is a phenomenon in superplasticity and creep and is significant to the prediction of cavity mechanism. However, compared to cavity growth, cavity nucleation is rarely reported in magnesium alloy, especially Mg-Li alloy. To investigate the cavitation nucleation, a novel Mg-7.28Li-2.19Al-0.1Y alloy has been fabricated by hot rolling and cold rolling; its flow stress and microstructural cavitation at elevated temperatures were investigated by optical microscopy and tensile tester. The maximum elongation to failure of 265.8% was demonstrated in this alloy at a temperature of 623 K and a strain rate of 5.0 × 10 -4 s -1 . Experimental results revealed that cavity or cavitation nucleated at interphase boundary and α-Mg grain boundary in quasi-superplasticity Mg-7.28Li-2.19Al-0.091Y alloy. The present alloy had coarse grain sizes and cavity nucleation was easy to initiate in this coarse-grained alloy. Helmholtz free energy map was plotted to predict the easy and difficulty of cavity nucleation in the present alloy. This work will enhance the workability and understand the fracture initiation behavior in the present α-Mg phase dominated alloy.