Mg2Si/MgO dispersoids reinforced Mg matrix composites (Mg2Si/MgO/Mg) were successfully in-situ solid-state synthesized by using Mg-SiO2 powder mixture on the route of preheating and hot forging. Results indicate that SiO2 can completely react with Mg and form Mg2Si/MgO dispersoids by preheated at 853 K for 240 s, and fully densified Mg2Si/MgO/Mg composites can be achieved by hot forged at 573 K under the pressure of 880 Wit. A method was proposed to calculate the reactive heat for forming Mg2Si/MgO dispersoids. It equals 705 0, implying that Mg can easily deoxidize SiO2. The synthesized Mg2Si/MgO dispersoids are inhomogeneous in size and shape when the initial powder mixture is conventionally cold compacted. On the other hand, the repeated plastic working (RPW) process not only improves the morphologies Of Mg2Si/MgO dispersoids but also decreases their synthesizing temperature. The mechanisms which are responsible for the microstructural improvement and the decrease in the synthesizing temperature are the refinement Of SiO2 particles and the breakage of MgO films on the surface of Mg particles.