Disclosed are a preparation method and application of Anaphalis lactea essential oil. Volatile oil in Anaphalis lacteal is extracted by steam distillation and CO2 supercritical extraction, ingredients of the volatile oil are analyzed initially by gas chromatography/mass spectrography, 57 ingredients in the volatile oil are identified and account for more than 94% of the total volatile oil. Antibacterial and bactericidal activities of the volatile oil are researched by the Oxford cup method, and according to the research, the volatile oil has an evident killing or inhibiting function for bacteria, such as staphylococcus, streptococcus, enterobacter, salmonella, shigella, pseudomonas, bacillus, escherichia coli and the like, and fungi, such as candida, cryptococcus, penicillin, aspergillus, mucor, microsporum, trichophyton, epidermophyton and the like. Testing by DPPH (diphenylpicrylhydrazyl) method shows that the volatile oil has fine antioxidant activity. Owing to the fine activity, the volatile oil is widely applicable to the industries of foods, medicines, cosmetics, health-care products and the like.