The invention discloses baby nursing cream and a preparation method thereof. The composition particularly comprises propylene glycol, xanthan gum, allantoin, Span (S60), Twain (T60), fatty alcohol, glyceryl stearate/PFG100-stearate, phytosterol ester, medicinal vaseline, vitamin E acetic ester, dragosantol, polydimethylsiloxane, acroloyl-dimethyl ammonium taurine/vinyl pyrrolidone copolymer, alkanet root extracts, menthol, borneol, nicotinamide, moutan bark extracts, yellowish sophora root extracts, peony extracts, phenoxyethanol and the balance deionized water. By controlling the mass ratio of the xanthan gum, the dragosantol and the phytosterol ester, the prepared nursing cream is high in film forming speed, non-irritant and good in drug stability, the composition of the baby nursing cream contains various plant extracts which are natural components, free from toxic and side effect and suitable for infants. The invention further provides a preparation method of the baby nursing cream. According to the preparation method, components are added into an emulsifying pot according to a certain sequence, the temperatures at stages are strictly controlled, effective compositions of medicines in the prepared nursing cream are effectively released, medicine effect is good, effect is rapid, and treatment time can be shortened to a great extent.