Reinforcing magnesium alloys with a discontinuously dispersed ceramic phase has engineered a new family of materials that are marketed under the trade name "metal-matrix composites". Continuous research efforts in the processing of these materials have provided the necessary impetus for their emergence and use in structural, automotive and even aerospace-related components. In this paper we report the results of a study aimed at understanding the role of short-fiber reinforcements (discontinuously dispersed through the metal-matrix of magnesium alloy AM100) on impact deformation and fracture behavior. In particular, the role of volume fraction of the reinforcing phase on impact energy and fracture behavior is presented and discussed. An increase in short-fiber reinforcement content in the magnesium alloy metal-matrix is obsd. to have a detrimental influence on impact energy when compared to the unreinforced counterpart. Micro cracking in the metal-matrix coupled with failure of the reinforcing fibers, both independently dispersed and in clusters, dominates the fracture sequence at the microscopic level. The final fracture behavior of the composite material is discussed in the light of the concurrent and mutually interactive influences of nature of loading, local stress state, intrinsic microstructural effects and deformation characteristics of the composite constituents