The invention discloses an environmentally-friendly lead-free glass powder used for a barrier of a PDP (plasma display panel), and a preparation method thereof. The glass powder is composed of the following raw materials in percentage by weight: 30-50% Bi2O3, 5-30% of B2O3, 5-30% of MgO, 5-30% of V2O5, 1-10% of P2O5, 1-10% of K2O, 1-5% CaO, 1-5% of SiO2 and 1-5% of Al2O3, wherein the total percentage of Bi2O3, V2O5 and P2O5 is 45-75% by weight and the total percentage of CaO, SiO2 and Al2O3 is 3-12% by weight. The preparation method comprises the following processes: weighing, mixing raw materials, melting, tabletting, ball-milling and screening. The glass powder has the advantages of low softening temperature, no lead, high sealing airtightness and diverse colors.