The invention discloses a compound traditional Chinese medicine preparation as well as a preparation method and application thereof. The compound traditional Chinese medicine preparation comprises thefollowing raw materials of chitosan oligosaccharide, grape seed extract, fructus corni, balsam pear, radix rehmanniae preparata, radix notoginseng, fructus lycii, radix salviae miltiorrhizae, radix angelicae sinensis, rhizoma polygonati, radix ophiopogonis, radix asparagi, rhizoma coptidis, radix glycyrrhizae preparata, folium nelumbinis, cortex lycii radicis, fructus crataegi, mulberries, cortexeucommiae, fructus arctii, rhizoma dioscoreae and probiotics. The compound traditional Chinese medicine preparation is scientifically matched according to the theory of syndrome differentiation and treatment of traditional Chinese medicine, has the effects of reducing blood sugar, clearing away heat and toxic materials, nourishing yin and tonifying kidney and weakness of spleen and lung, enhancesthe function of a human body, is high in cure rate, short in treatment course, low in recurrence rate and less in toxic and side effects, and has a better effect on relieving diabetes and complications caused by diabetes. The defects of pure traditional Chinese medicine treatment and western medicine treatment are overcome, and the traditional Chinese medicine preparation is worthy of clinical application and popularization.