Benefits of RE addition on Mg alloys strength and corrosion resistance are widely reported but their effects on biodegradability and biocompatibility are still of concern. This paper investigates the effect of RE additions on biodegradability of Mg-Zn alloys under simulated physiological conditions. In this context, two commercial Mg-Zn-Zr-RE alloys, namely ZE41 and EZ33, with same RE addition but different concentrations are studied in Hank's Balanced Salt Solution (HBSS) at 37 °C and with pH of 7.4. Weight-loss, hydrogen evolution, real-time in-situ drop test, electrochemical impedance spectroscopy (EIS) and potentiodynamic polarization are deployed to study corrosion characteristics. The mechanical integrity of both alloys is assessed by mechanical testing post immersion. Furthermore, in vitro biocompatibility is evaluated by indirect cytotoxicity tests using NIH3T3 cells. Results reveal that although both alloys showed similar microstructure, size and distribution of precipitates played a significant role on its corrosion response. EIS and open circuit potential results show stable film formation on EZ33, while ZE41 showed passive layer formation followed by its deterioration, over the analyzed time period. Using real-time drop test, it was shown in ZE41 alloy that both T-phase and Zr-rich precipitates acted as micro cathodes, resulting in an unstable surface film. In EZ33, Zr-rich regions did not influence corrosion response, resulting in better corrosion resistance that was corroborated by post-immersion surface morphology investigations. The higher degradation observed in ZE41 alloy resulted in higher drop in flexural and tensile strength compared to EZ33 alloy. In addition, cytotoxicity tests on NIH3T3 cells revealed that cell viability of EZ33 increased with increasing incubation time, contrary to ZE41, owing to its lower biodegradation behavior and despite higher concentrations of REs. Present results show that an increase in RE concentration in EZ33, relative to ZE41, had a positive effect on corrosion rate that subsequently controlled alloy mechanical integrity and biocompatibility.