Magnesium has very strong affinities with oxygen and sulphur. Therefore, it is necessary to know the exactly thermodynamic values on deoxidation of magnesium in liquid iron for ultra high quality steel production and composition control of non-metallic inclusion. However, the proposed deoxidation equilibrium relation shows a loop in the figure which shows the relation between magnesium and oxygen dissolved in liquid iron. This means one concentration of magnesium corresponds to two concentration of oxygen and vice versa. Therefore, it is impossible theoretically to control the oxygen content with magnesium. It causes by use of only 1st order interaction parameters to express the activities of magnesium and oxygen. In the present work, the deoxidation equilibrium of magnesium was studied on the viewpoint that the thermodynamic values concerning very strong deoxidation such as magnesium have to be evaluated by 1st and 2nd order interaction parameters including cross products too. As the result, the temperature dependence of thermodynamic values on magnesium deoxidation was obtained, and it was in good agreement with the observed values in the present work.