The invention relates to composite materials, in particular to a tire rubber powder modified recycled plastic and a preparation method thereof. The invention aims to solve the existing zero pollution reclamation difficulty and other problems of waste tire rubber, waste plastics, etc. The tire rubber powder modified recycled plastic provided in the invention is prepared from the following raw materials by mass: 20%-70% of waste plastics, 10%-40% of tire rubber powder, 5%-26% of a flame retardant, 1%-10% of a compatibilizer, 0.1%-3% of a lubricant, 0.5%-5% of a plasticizer, and 0.05%-4% of an antioxidant. In the invention, by modifying tire rubber powder to prepare the recycled plastic, the resource utilization rate of waste tire rubber powder is enhanced, a new application technology of rubber powder is developed, the application scope of rubber powder is expanded, and at the same time, the prepared recycled plastic still has good mechanical properties, and the production cost of the recycled plastic is greatly reduced, so that the application fields of recycled plastics can be expected to be further expanded.