The influence of the Mg concentration and lattice temperature on the carrier recombination dynamics in Zn_1-xMg_xO alloys has been studied by time-resolved photoluminescence for different emission and excitation energies. Carrier localization effects are found to play a significant role, becoming increasingly important for lower temperatures and higher Mg concentrations. Emission energy dependent dynamics were analyzed by the application of the theoretical model, yielding a characteristic localization energy of 60±15 meV for the sample with the highest Mg concentration of x=0.21.