In order to obtain homogeneous dispersion of nano-carbon in Mg matrix, the effect of surfactants cetyltrimethylammonium bromide(CTAB), polyvinyl alcohol(PVA), sodium dodecylbenzene sulfonate(SDBS) and polyvinylpyrrolidone(PVP) on the dispersion of reinforcement was compared. PVP was selected as the functional dispersant in this work. The uniform dispersion of nano-reinforcement was achieved in Mg matrix by high-intensity ultrasonic functionalization with surfactant, and then carbon microspheres(CMSs) reinforced Mg matrix composites were prepared. The influence of ultrasonic time and the content of PVP on the products was investigated to optimize dispersing process. The morphology and structure of the samples were characterized by field emission scanning electron microscopy, dynamic light scattering, UV spectrophotometry, Fourier transform infrared spectroscopy and raman spectroscopy. The results show that dispersed CMSs were absorbed on the surface of Mg particles, and the wettability of Mg powder was increased by PVP. Reinforcement was homogeneously dispersed in Mg matrix with 10 g/L PVP ethanol solution by 60 min of ultrasonication without destroying its structure.