The invention discloses an application of limonite with excellent balling property as an adhesive and a pellet preparation method. The limonite comprises limonite powder, and chemical components of the limonite powder comprise iron, silicon dioxide, calcium oxide, magnesium oxide, aluminum oxide, water, sulfur, phosphorus and the like. The pellet preparation method comprises the steps of raw material preparation and mixing, pelletizing, drying, preheating, roasting, cooling and the like. The drying comprises forced air drying and air draft drying. The balling index of the limonite-based adhesive reaches 1.55, and the balling index is improved by 59.8% compared with the balling index of bentonite in the prior art. By the adoption of the pellet preparation method with the limonite powder as the adhesive, the adding amount of the bentonite in the pelletizing process can be reduced by 40%, the charging grade of iron-containing raw materials of a blast furnace is improved by 0.18%, the slag discharging amount is reduced by 0.27%, the carbon dioxide emission amount is reduced by 0.99%, and the ore blending cost is reduced by 22 yuan/ton or above. The blast furnace smelting has the benefits of cost reduction, efficiency improvement, energy conservation and emission reduction, and has important significance for realizing carbon neutralization when carbon reaches the peak.