Dislocation structure in rapidly solidified Mg₉₇Zn₁Y₂ ribbon with the long period stacking order (LPSO) phase is investigated by conventional transmission electron microscopy. In the grain with the LPSO phase there are no a dislocations lying on the basal plane, and a number of c+a dislocations are visible. On the other hand, in the grain without the LPSO phase there are many straight a dislocations lying on the basal plane. These facts indicate that the critical resolved shear stress of the basal plane increases by the formation of the LPSO phase and the non-basal slip is activated by the prevention of the basal slip. In other words, the former directly contributes to the strengthening and the latter relates to the improvement of ductility with the increment of the number of the slip system. Therefore, it is concluded that the LPSO phase plays a unique role which overcomes the conflicting properties of strength and ductility in the mechanical property of the present alloy.