The effect of precipitation on the internal friction (IF) of AZ91 magnesium alloy was investigated by using X-ray diffraction (XRD) analysis, scanning electron microscope (SEM) observation, and dynamic mechanical analysis (DMA). Six different states of alloy were prepared by applying different heat treatment processes: as-cast, in-complete solid solution, complete solid solution, micro-precipitation, continuous precipitation and continuous-discontinuous precipitation. It was found that the internal friction of in-completely solid-solutionized, completely solid-solutionized and micro-precipitated specimens showed a similar characteristic, and the grain boundary relaxation is completed depressed due to the Al atoms supersaturated in the alpha-Mg solution. However, a thermal relaxation internal friction peak was observed for continuously precipitated and continuously-discontinuously precipitated specimens at around 438 K and frequency of about 1 Hz, which was attributed to the grain boundaries relaxation. Furthermore, it was found that the relaxation of the beta-Mg(17)Al(12)/alpha-Mg phase interfaces should give its contribution to the background internal friction in the as-cast, continuously precipitated and continuously-discontinuously precipitated specimens.