The invention relates to a highly-polished prehardened die steel, and a preparation method thereof. The highly-polished prehardened die steel is composed of, by mass, 0.21 to 0.25% of C, Si<=0.30%, 1.40 to 2.00% of Mn, 1.30 to 1.70% of Cr, 0.60 to 1.00% of Ni, 0.40 to 0.60% of Mo, V<=0.10%, P<0.015%, S<0.005%, 0.02 to 0.04% of Nb, and the balance Fe. The preparation method comprises following steps: material blending, smelting, casting, and hot charging; high temperature diffusion heat treatment, multi-directional forging heat processing, after-forging heat treatment, and sawing; and hardeningand tempering heat treatment. The hardness of the obtained tempered martensite structure ranges from 38 to 42HRC. The advantages of the highly-polished prehardened die steel are that: cost is low, hardenability and hardness are high, and polishing properties and cleavage line etching performance are excellent.