The invention discloses a Chinese herbal medicine for treating an open wound and a preparation method thereof. The Chinese herbal medicine is prepared from the following 14 raw herbal materials: Artemisia anomala, Bletilla striata, asiatic toddalia root, leaf of chinese ilex, humifuse euphorbia herb, herba orostachyos, Ampelopsis delavayana (Franch.)Planch.[Vitis delavayana Franch.], polygonum bistorta, purslane, rheum officinale, bone-joining elixir, honeysuckle, folium isatidis and borneol. The 14 raw herbal materials are reasonably and scientifically combined and prepared into the Chinese herbal medicine. Through actual use, the Chinese herbal medicine has effects of stopping bleeding and diminishing inflammation, removing pus and drawing out toxin, clearing away heat and toxic materials, relieving swelling and pain, and removing slough and promoting growth of tissue regeneration. When mainly serving as an external medicine, the Chinese herbal medicine can be mainly used for treating open type wounds such as trauma (open wound), wound bleeding, bruise, puncture wound, cut wound, chop wound, avulsion, contusion and firearm injury; and moreover, the Chinese herbal medicine can also be used for treating wound diseases such as severe and lingering ulcerating wounds, small skin and soft tissue wounds of diabetes patients and erosive beriberi.