We investigate the structural, magnetic, and specific heat behavior of the hexagonal manganite Dy0.5Y0.5MnO3 in order to understand the effect of dilution of Dy magnetism with nonmagnetic yttrium. In this compound, the triangular Mn lattice orders antiferromagnetic at T-N(Mn) approximate to 68 K observed experimentally in the derivative of magnetic susceptibility as well as in specific heat. In addition, a low-temperature peak at T-N(Dy) similar to 3 K is observed in specific heat which is attributed to rare earth order. The T-N(Mn) increases by 9 K compared to that of hexagonal (h) DyMnO3 while T-N(Dy) is unchanged. A change in slope of thermal evolution of lattice parameters is observed to occur at temperature close to T-N(Mn). This hints at strong magnetoelastic coupling in this geometric multiferroic. In magnetization measurements, steplike features are observed when the magnetic field is applied along the c axis which shift to higher fields with temperature and vanish completely above 40 K. The presence of different magnetic phases at low temperature and strong magnetoelastic effects can lead to such field-induced transitions which resemble metamagnetic transitions. This indicates the possibility of strong field-induced effects in dielectric properties of this material, which is unexplored to date.