Wire-arc directed energy deposition (WA-DED) has attracted considerable attention for the fabrication of magnesium (Mg) alloys due to its high efficiency, low cost, and rapid prototyping capability for complex components. However, the inherent rapid solidification and complex thermal cycling associated with WA-DED often result in coarse columnar grains and pronounced mechanical anisotropy, which severely limiting its application potential. In this study, a novel spiral oscillation (SO) strategy was implemented during WA-DED AZ31 Mg alloy to refine the microstructure, reduce mechanical anisotropy, and achieve a strength-ductility synergy. Specifically, the yield strength (YS), ultimate tensile strength (UTS), and elongation (EL) are increased by 9.7%, 38.1%, and 147%, respectively. These improvements by the SO strategy are primarily attributed to the promotion of columnar-to-equiaxed transformation (CET), a 74.2% reduction in maximum texture intensity, and a more uniform distribution of second-phase particles. Second-phase particles are primarily composed of Al8Mn5 and Al8Mn4Y. This study provides a novel strategy for microstructural control aimed at improving the performance of WA-DED AZ31 Mg alloy components.