The present work examines the influence of Mg-Ag-(Mn) substrates on plasma electrolytic oxidation (PEO) film formation, with systematic examinations of microstructural features, corrosion resistance and biological performance. It is revealed that silver (Ag) species enrich at the PEO film/substrate interface while simultaneously distributing throughout the film as Ag₂O nanoparticles. Manganese (Mn) species incorporate predominantly as MnO₂ within the film. The synergistic combination of Mn micro-alloying and post-casting heat treatment (PCHT) of the substrate enables the formation of a thicker PEO film with reduced defectiveness, which significantly enhances its corrosion resistance and precisely tailors the release kinetics of Mg²⁺, Ag⁺ and Mn²⁺. Hence, PEO treatment of compositionally and microstructurally optimized Mg-Ag-based substrates achieves an optimal balance between corrosion protection and biological performance, which is regarded as a promising advancement for developing multi-functional Mg-based orthopedic implants.