The invention relates to a smooth memory knitted fabric and a preparation method thereof. The smooth memory knitted fabric comprises an outer layer and an inner layer, the outer layer is composed of super fine denier polyester fibers, and the inner layer is composed of Modal fiber staple yarns and polyurethane fiber filaments. The preparation method includes that (1) after structural design, a weft knitting single-sided multi-needle-track high needle pitch knitting machine is used for weaving with weft knitting number 28-32G to obtain a knitted fabric, and (2) the obtained knitted fabric is subjected to presetting, pre-processing, polyester fiber dyeing, Modal fiber overdyeing, color fixing, water scrubbing, repeatedly setting and finally drying. The smooth memory knitted fabric has the advantages that the smooth memory knitted fabric is highly elastic, fine, smooth, quickly dry when absorbing water, antimicrobial, deodorant, not prone to deformation after washed, light, convenient and comfortable if a user wears clothes made of the fabric, and capable of overcoming defects of poor hand feel, creased cloth surfaces, insufficient wet permeability, tendency to stink and the like in terms of traditional fabrics.