The invention provides an erbium-containing aluminum magnesium alloy wire and a production method thereof, and belongs to the technical field of alloy production. The erbium-containing aluminum magnesium alloy wire comprises the following components, in percentage by weight, of 1.3% to 2.5% of Mg, 0.4% to 0.8% of Er, 0.01% to 0.1% of Cr, 0.01% to 0.15% of Mn, 0.1% to 0.3% of Fe, 0.03% to 0.15% of Si and the balance Al, a total content of other impurities does not exceed 0.25%, and a content of a single impurity component does not exceed 0.1%. A manufacturing method of the erbium-containing aluminum magnesium alloy wire comprises the manufacturing steps of burdening, melting, refining, liquid discharging, horizontal traction casting, cast rod drawing, intermediate annealing, thick wire drawing, intermediate annealing, thin wire drawing and finished product annealing. The production efficiency is improved, the production cost is reduced, and the properties such as product strength and ductility can be improved.