The paper presents the effect of precipitation hardening on the mechanical and tribological properties of magnesium alloy WE54. Mechanical tests have shown that the hardness and Young’s modulus of the alloy increased as the ageing time became longer. Improvement of the mechanical properties had a direct influence on the tribological properties. Tribological tests were performed on a ball-on-disk tribometer, applying variable loads of 2, 5, and 10 N. In the tests, a more than fourfold decrease in the specific wear rate, a threefold reduction in the linear wear, and a ca. 20% reduction of the friction coefficient were observed. The best results were obtained for ageing time of 24 h. The extension of the heat treatment time to 48h caused overageing of the alloy, which resulted in the deterioration of its mechanical and tribological properties.