The invention discloses a bio-organic fertilizer for preventing and treating soil-borne diseases. The bio-organic fertilizer is prepared from the following raw materials: a microbial inoculum, peanutoil pressing residues, corn starch, filter mud, beef extract, soybean cake, monopotassium phosphate, urea, molasses, potassium sulfate, water and the like. The microbial inoculum is composed of Bacillus polymyxa and further comprises any one or a mixture of more than one of Bacillus amyloliquefaciens, Bacillus mucilaginosus and Bacillus pumilus. The invention also provides a preparation method andan application method of the bio-organic fertilizer. The bio-organic fertilizer disclosed by the invention is also rich in organic carbon and organic nitrogen, so that the colonization and function exerting capabilities of functional microorganisms in soil are improved, the growth of pathogenic microorganisms is favorably inhibited, and soil-borne diseases such as root rot, bacterial wilt, seedling blight, damping-off, canker and root-knot nematode disease are effectively prevented. The use amount of chemical fertilizers and pesticides can be reduced, guiding significance is provided for production of harmless agricultural products, and good social benefits and economic benefits are achieved.