The invention provides a free-cutting aluminum copper alloy extruded bar and a preparation method thereof. The aluminum copper alloy extruded bar comprises the following components of, in percentage by mass, 3.5%-4.5% of Cu, 0.6%-0.9% of Mg, 0.6%-1.0% of Mn, 0.4%-0.6% of Cr, 0.15%-0.25% of Ce, 0.06%-0.1% of B, 0.01%-0.02% of Ti, 0.0004%-0.0008% of C, 0.8%-1.2% of Sn, 0.3%-0.5% of Bi, less than orequal to 0.2% of Fe, less than or equal to 0.1% of Si, and the balance Al and other impurity elements. The preparation method of the bar sequentially comprises the steps of burdening, smelting an aluminum copper molten alloy, in-furnace blowing and refining treatment and degassing and impurity removing, on-line grain refining, on-line degassing filtering treatment, semi-continuous casting treatment, cast bar homogenizing, heating extruding treatment, on-line quenching and artificial aging treatment. The aluminum copper alloy extruded bar does not contain heavy metal element lead, meets the environment-friendly requirement, and has good mechanical properties and excellent cutting machining performance; cutting chips are easy to break, not prone to adhere to or twine around a cutter, the production efficiency of cutting machining is improved, and the surface smoothness and the size precision of products are improved.