Comprehensive first‐principles density functional theory (DFT) calculations are conducted to study the effects of solutes on the stacking fault energies (SFEs) for basal, prismatic, and pyramidal slip systems in binary magnesium alloys. The two main aspects prescribing the solute effect on SFE are elucidated to be mechanical and electronic in nature, respectively, and critically assessed. On the basis of the misfit volume and d‐electrons, these two aspects are then quantified and subsequently a predictive model of the solute effect on the SFE is developed, with good agreement achieved between the model prediction and DFT results. Herein, important mechanistic insights and predictivity critical for rational design of Mg alloys of enhanced mechanical properties are provided.