The invention discloses an automobile cable insulating material and a preparation method thereof. The automobile cable insulating material is characterized by being prepared by, by weight, 3-6 parts of EVA resin, 2-4 parts of anhydrous lithium chloride, 90-100 parts of polyvinyl chloride, 10-15 parts of magnesium hydrate, 5-10 parts of antimony trioxide, 10-14 parts of nanometer clay, 0.3-0.7 part of silane coupling agent kh550, 0.5-1 part of polyvinyl alcohol, 0.1-0.3 part of sodium dodecyl benzene sulfonate, 0.5-2 parts of sodium bicarbonate, 2-5 parts of styrene, 0.02-0.05 part of potassium persulfate, 10-15 parts of dioctyl terephthalate, 3-5 parts of tributyl citrate, 1-3 parts of hard wax, 3-5 parts of fumed silica, 2-4 parts of wood flour and an appropriate amount of water. The cable material can meet the requirement for environmental friendliness and has good comprehensive performance, the preparation method is simple and controllable, and the cost is low.