The bimetallic composite rods prepared by co-extrusion have good mechanical properties, but their compressive deformation behaviors have rarely been studied. This paper primarily investigates the compressive deformation behavior of the AZ31/Mg-Gd-Y composite rod, analyzes the differences between its compressive deformation behavior and that of AZ31, and systematically studies the compressive deformation mechanisms of various regions in the composite rod, as well as the texture evolution and {10-12} twin evolution during the compression process. The results reveal that the AZ31/Mg-Gd-Y composite rods exhibit excellent metallurgical bonding, with the interface remaining intact even under a 9% compressive strain. In the compression process, AZ31 initiates yielding earlier than the AZ31/Mg-Gd-Y composite rods, exhibiting a relatively lower yield strength, whereas both show comparable plasticity. The deformation behavior of the AZ31/Mg-Gd-Y composite rod is governed by a combination of basal 〈a〉 slip and {10-12} 〈-1011〉 tension twinning during compression along the ED (extrusion direction). With increasing compressive strain, the number of {10-12} twins in the AZ31 region (A/G-AZ31) of the AZ31/Mg-Gd-Y composite rod increases significantly, leading to changes in grain orientation, whereas the Mg-Gd-Y region (A/G-Mg-Gd-Y) of the composite rod shows no significant change. In addition, the A/G-Mg-Gd-Y significantly inhibits the nucleation and growth of {10-12} twins in A/G-AZ31 during compression, and thus the texture hardening generated by {10-12} twins make the work hardening behavior of the AZ31/Mg-Gd-Y composite rods different from that of AZ31.