Ab-initio research has been used in this work to investigate the structural stability, elastic, electronic, thermal, and optical properties of Mg-Cu-Y compounds. The Mg-Cu-Y compounds’ thermodynamic stability is guaranteed by their negative cohesive energy (Ecoh) and formation enthalpy ( \(\Delta H_{r}\) ), with the MgCu4Y phase having the Ecoh of − 4.464 eV/atom and \(\Delta H_{r}\) of − 0.187 eV/atom. The determined elastic constants validate the mechanical stability of the Mg-Cu-Y compounds under research by meeting Born’s stability requirements. High resistance to axial tensile/compressive deformation and shear deformation is further guaranteed by the MgCu4Y phase’s greater Young’s and shear moduli compared to other ternary phases. In addition, the calculated electronic bonding information indicates that the d-band center of Cu atoms contributes significantly to the bonding energy and mechanical properties of their compounds. Moreover, in the Mg-Cu-Y ternary compounds, the relatively low magnesium content and shorter weighted average bond lengths contribute to the higher modulus observed in Mg2Cu9Y and MgCu4Y phases. In addition, the Mg2Cu9Y phase has the melting point of 1699.26 K. The MgCu4Y phase exhibits a relatively high minimum thermal conductivity in all the Mg-Cu-Y ternary compounds, measuring 1.03 W m−1K−1, whereas the MgCu2Y2 phase has a comparatively low value of 0.56 W m−1K−1. Lastly, the Mg2Cu9Y phase exhibits optical conductivity at a wavelength of approximately 2163 nm, with a value of approximately 37.5 1/fs.