Tha Phae Gate, the heart of Chiang Mai's Old City
The short answer: your Malaysian driving license is legally recognised in Thailand, but you should still get an International Driving Permit before you fly. Here's why both of those things are true at once, and how the actual rental process works in the Old City.
Malaysia and Thailand are both signatories to the 1985 ASEAN Agreement on the Recognition of Domestic Driving Licences. Under this agreement, a valid Malaysian license, for the correct vehicle category, is legally recognised for temporary stays in Thailand, without needing an International Driving Permit (IDP) at all. This is a real treaty, not a workaround.
In practice, though, Thai police checkpoints don't always apply this distinction cleanly, and several checkpoints around Chiang Mai routinely ask for an IDP specifically, fining riders who can't produce one, ASEAN agreement or not. Insurance is the other complication: some rental shop and travel insurance policies are written around the IDP as the expected document, and having only a national license, even a legally valid one, can complicate a claim after an accident.
The practical takeaway: bring an IDP anyway. It costs little, takes a day or two to arrange through JPJ or the Automobile Association of Malaysia before you travel, and removes any ambiguity at the roadside or with an insurer.
A Malaysian International Driving Permit, worth arranging before you fly
Whichever document you carry, it needs to cover motorcycles specifically, not just cars. Malaysian licenses are split by class, B2 covers underbone motorcycles, D covers mopeds and scooters up to certain engine sizes. Most rental scooters in Chiang Mai are 125cc Honda Click, Scoopy, or Wave models, so confirm your license class actually covers that engine size before you rely on it. A car-only license (class B or D for smaller cars) does not extend to scooters.
Chiang Mai's Old City, particularly around Tha Phae Gate, has one of the densest clusters of scooter rental shops in the country. A few things to know before you walk in:
A typical Old City rental shop, rows of Honda Click and Scoopy models
A five-minute walk-around inspection protects your deposit
Walk around the scooter with a staff member and photograph every scratch, dent, and worn spot before you leave the shop. This is the single best protection against a disputed damage claim at return. Reputable shops expect this and won't be offended by it.
Confirm a helmet is included, it's legally required for both rider and passenger, and Thai police do enforce this one consistently in the city.
Police checkpoints do check for an IDP specifically
There's a fixed police checkpoint on Huay Kaew Road, on the route up toward Doi Suthep, that specifically checks for IDPs. Riders without one have reported on-the-spot fines in the 500 to 1,000 THB range. If your plans include the temple or the mountain roads above the city, this is the checkpoint most likely to test whether your paperwork is in order.