The invention relates to a novel compound fertilizer and a preparation method thereof. The novel compound fertilizer is prepared from, by weight, 10-15 parts of ammonium phosphate, 8-12 parts of phosphorus nitrate, 2-6 parts of TBHQ, 3-5 parts of potassium nitrate, 3-5 parts of monopotassium phosphate, 20-25 parts of urea, 3-5 parts of monopotassium phosphate, 2-5 parts of diammonium phosphate, 20-25 parts of rape seed cakes, 10-20 parts of tea seed cakes, 10-20 parts of chicken manure and 3-8 parts of fermentation powder. The novel compound fertilizer is easy in material acquisition, low in cost, sufficient, rich in nutrition component, less prone to causing soil acidification and basification and effective in alleviation of soil problems, absorption capacity of crops is improved, growth acceleration and yield increase are realized, and freeness of caking, easiness in decomposition and absorption, high oxidation resistance, stability improvement and long retention time are realized.