Mg–Gd is a promising light hardenable alloy with a high creep resistance at elevated temperatures. The supersaturated solid solution of Gd in Mg decomposes in a sequence of the following phases: β″(D019)→β′ (c-base centered orthorhombic-c-bco)→β (fcc) stable. Formation of the metastable β′ phase causes a strong hardening. Dislocations facilitate nucleation of precipitates. Dislocation density is, therefore, an important parameter which influences the precipitation process. This effect was examined in the present work by comparison the decomposition sequences in Mg–15wt.%Gd alloy cold rolled to various thickness reductions. It was found that precipitation of the β′ phase starts at lower temperatures in the cold rolled specimens.