The invention discloses a composite encapsulating material with high heat conduction activity and a preparation method thereof, and belongs to the field of metal based composite materials. The composite material consists of SnAg4Ti4 alloy powder, aluminum powder and diamond particle reinforcer, wherein volume percentage of diamond particles is 50%-70%, volume percentage of aluminum powder is 25%-49%, and volume percentage of SnAg4Ti4T alloy powder is 1%-5%. A preparation method for the composite encapsulating material comprises the following steps: preparing active brazing filler metal SnAg4Ti4 alloy powder through a vacuum gas-atomization powdering furnace, mechanically mixing powder, and putting mixed powder into a discharge plasma sintering furnace to prepare a diamond / aluminum composite material. The sintered composite material is relatively good in interface bonding, is relatively high in compactness, has heat conductivity of 703W / m.K, has a thermal expansion coefficient reduced to 7.9*10<-6> / K, and has compactness of 97.8% or more. The preparation method is strong in operability, is simple in process, and can be used for the fields of electronic encapsulating and the like.