Mg-Doped TiO2 nanoparticles were prepared via a modified sonothermal method, and their photocatalytic activities were investigated for the reduction of CO2 with H2O. The structural properties of the prepared catalysts with varying Mg doping levels were studied by UV-vis spectroscopy, N2 adsorption-desorption, XRD, SEM, TEM, and XPS. CO, H2, CH3OH, and CH4 were the major products observed with a maximum production rate of 29.2, 28.7, 5910.0 and 2.3 μmol g-1 h-1, respectively. Preferable Mg doping sites in TiO2 nanoparticles and interaction of CO2 with Mg-doped TiO2 were studied computationally. Modeling revealed that (101) facets and junctions of (101)/(101) and (001)/(101) facets are the preferred locations of surface Mg atoms. Adsorption of CO2 proceeds in the bent carbonate and hydrocarbonate forms. The increased activity of Mg-doped TiO2 is explained by the close proximity of surface Mg reaction sites to the positions of photogenerated electrons on (101) facets.