Magnesium alloy sheets exhibit strong inelastic response during unloading. In this study crystal plasticity finite element analysis of loading-unloading behaviour during uniaxial tension in a rolled magnesium alloy sheet was carried out, and the mechanism of this inelastic response was examined in detail in terms of macroscopic and mesoscopic deformations. The unloading behaviour obtained by the simulation was in good agreement with the experiment in terms of variation with stress of instantaneous tangent modulus during unloading. Variations of activities of each family of slip systems during the deformation showed that the activation of basal slip systems is the largest during unloading, and the slip direction during unloading is opposite from during loading. These results indicated that one of the factors of the inelastic behaviour during unloading is the fact that the basal slip systems are easily activated during unloading because of their low strengths.