The invention discloses a green microemulsion metal cutting fluid and is characterized in that its formula comprises mixed base oil, synthetic ester, an oiliness agent, an extreme pressure antiwear additive, a clean dispersant agent, an antirust anticorrosion additive, an anti-oxidant, an oil mist inhibitor, a bactericide, an antifoaming agent, an anionic surfactant, a nonionic surfactant and a cosurfactant. A preparation method of the green microemulsion metal cutting fluid comprises the following steps of: firstly preparing an oil phase, heating the base oil to 50-60 DEG C, successively adding the oiliness agent, synthetic ester, the extreme pressure antiwear additive, the clean dispersant agent and the antirust anticorrosion additive, uniformly stirring and mixing to prepare an oil phase system; then preparing a water phase, successively adding the bactericide and the antifoaming agent into water, uniformly stirring and mixing to prepare a water phase system; finally emulsifying the systems, and slowly adding the water phase into the oil phase system to form the green microemulsion metal cutting fluid. The green microemulsion metal cutting fluid provided by the invention has advantages of excellent extreme pressure wear resistance, resistance to hard water, long using period and the like.