The invention relates to a starch and polylactic acid composite material and a preparation method thereof. The composite material comprises, by weight, 20 to 75 parts of modified starch, 10 to 65 parts of polylactic resins, 2 to 10 parts of hydroxy-terminated lactic acid oligomer with molecular weight of 800 to 2000, 1 to 10 parts of plasticizers, 0.1 to 1.0 part of aliphatic chain extenders, 0.5 to 2 parts of talcum powders and 0.1 to 3 parts of auxiliaries. The preparation method includes that firstly the modified starch, the polylactic acids, the hydroxy-terminated lactic acid oligomer, the plasticizers, the talcum powders, lubricating agents and coupling agents are blended together in a homogenizer to obtain a blend, and then a mixed material of the blend and the chain extenders is added in a twin-screw extruder to be subjected to melt extrusion, cooling and granulation to obtain the starch and polylactic acid composite material. The starch and polylactic acid composite material has the advantages that the compatibility, toughness and heat resistance are good, the cost is low, the biodegradation can be completely achieved, the preparation technique process is simple, the 'three wastes' emission is absent, and the mass production can be achieved.