Casting experiments were carried out on Al–7Si using different additions of rare earth Ce at a reaction temperature of 1200 K. Based on the ternary phase diagram of Al–Si–Ce, the effects of rare earth Ce on the α-Al grain refinement, the mechanism of the eutectic Si phase modification, as well as on the mechanical properties and fracture morphology of the alloy were investigated. The results show that the addition of rare earth Ce generates a Ce-containing phase inside the alloy, which becomes a heterogeneous core of eutectic Si and changes the nucleation conditions of eutectic Si. The mechanical properties of the alloy were optimal when the Ce addition was 0.2 wt.%, and the defect porosity and average pore area were minimized. Ce-containing phases were found at fracture cracks, and these Ce-containing phases were deviated and aggregated at grain boundaries, which induced defects to be generated, and microcracks were easily produced during plastic deformation, which ultimately led to the fracture of the alloy. According to the growth kinetic relationship, due to the difference of different atomic radii, the inter-atomic forces lead to different nucleation densities of grains. With the generation of Ce-containing phases at the interfaces, the eutectic Si changes its growth direction and grows towards a 70° angle to the original direction with a tighter atomic ordering sequence of the stacking, and more twinned Si is generated and gradually stacked up at the interfaces, which directly alters the morphology of the eutectic Si.