The synthesis of Mg-Zn-Y quasicrystalline powders by mechanical alloying was investigated in this study. The results indicate that Mg3Zn6Y quasicrystal can be obtained directly by milling the pure Mg, Zn, Y powders of Mg30Zn60Y10 composition for 2 hours. However, milling the powders with compositions in the neighborhood of stoichiometric Mg3Zn6Y quasicrystal creates the Mg solid solutions, which transform to the Mg3Zn6Y quasicrystal by annealing the milled powders at 300℃. The Mg3Zn6Y quasicrystal is stable below 300℃. At 400℃ it transforms to MgZn2 and YZn5 phases. No quasicrystalline phases were formed upon milling the compositions near the cubic Mg3Zn3Y2 phase. For the initial composition Mg20Zn70Y10, which is close to Zn end in the Mg-Zn-Y phase diagram, milling directly creates YZn5 phase.