The dilatation characteristics of pre-deformed AX41 magnesium alloy and AX41-12 vol.% C-fibre composite were determined in the temperature range 20 – 380 °C. Two fibre orientations for the composite were investigated: parallel and perpendicular to the axis sample. During the first thermal cycle after compression deformation, the recovery of the alloy and composite occurs in two steps. We observed the recovery of twins at low temperatures, and the recovery of dislocations at higher temperatures. The released plastic deformation is larger in composites with fibres perpendicular to the sample axis than in composites with fibres parallel to the sample axis. We analysed the deformation curves for the alloy and both composites.