Inhomogeneous deformation in a magnesium alloy with long-period stacking order (LPSO) phase has been investigated using high-precision markers drawn by electron beam lithography. Mg alloys containing Zn and rare earth elements such as Y have a characteristic microstructure including the LPSO phase and the usual hcp matrix phase. The mechanical performance of this alloy is remarkably enhanced by warm-extrusion. The microstructure developed by such extrusion consists of elongated grains with fine-lamellae of LPSO phase and fine-grained matrix of hcp phase. In order to clarify the details of inhomogeneous deformation which should relate with the superior mechanical properties in this alloy, high-precision marking method using electron beam lithography has been employed. By using the method, local displacement due to tensile deformation in the Mg alloy was directly measured.