One the biggest challenges facing the development of Mg-ion battery technology is the fact that many promising Mg electrolytes are incompatible with either the metallic Mg anode or with the high voltage oxide cathode materials that are required to compete with existing Li-ion technologies. Understanding the role of the many impurity species present in Mg electrolytes is crucial to understanding how to design new electrolytes that can stabilize Mg metal without using Cl^-, and therefore enable its use with oxide cathodes in full cells. In light of these complexities, we introduce a surface science-based approach for rationalizing, and ultimately understanding, the impurity-driven electrochemical processes that take place during the electrodeposition of Mg ions, focusing in particular on the technologically-relevant Mg bis-(trifluoromethane sulfonyl) imide (MgTFSI₂) in diglyme electrolyte system. Using a combination of electrochemical and spectroscopic methods, it was found that trace amounts of water (≤ 3 ppm) strongly impact both the kinetics of Mg deposition and the reversibility of Mg stripping, with the formation of passive surface films taking place only after Mg deposition ceases and the extent of passivation determining the electrochemical response and resulting Coulombic efficiency. A complex and dynamic competition between H₂O and Cl^- species present at the interface was also observed that results in dramatic changes to the surface chemistry and the resulting deposition/stripping kinetics. We anticipate that this surface science-based approach is relevant well beyond Mg deposition/stripping, and can be applied to the deposition/stripping of Li and other mono/multivalent metals, intercalation/deintercalation processes in multivalent cathode materials, and many other systems.