The invention discloses a bio-based microcapsule mixed waterborne formaldehyde removing coating and a manufacturing method thereof. The coating is prepared from 300 parts to 350 parts of deionized water, 2 parts to 3 parts of defoaming agent, 20 parts to 25 parts of phyllostachys pubescens fiber, 30 parts to 40 parts of wood fiber, 8 parts to 10 parts of dispersant, 2 parts to 3 parts of wetting agent, 8 parts to 10 parts of propylene glycol, 6 parts to 8 parts of coalescing agent, 120 parts to 130 parts of nano titanium dioxide powder, 170 parts to 180 parts of kieselguhr, 40 parts to 45 parts of wollastonite powder, 50 parts to 55 parts of 4000-mesh calcined kaoline, 130 parts to 140 parts of styrene-acrylic emulsion, 4 parts to 5 parts of thickening agent, 70 parts to 80 parts of baijiang soil and 3 parts to 5 parts of cyanobacteria microbial agent. The bio-based microcapsule mixed waterborne formaldehyde removing coating disclosed by the invention contains microcapsules, has life activity, contains a photocatalyst, has a dust removing function, can absorb and decompose a part of noxious substances and can be green in all seasons.