The invention discloses a high-performance powder forging alloy material and a preparation method thereof. The material comprises the following components of 1%-2% of Ni, 0.3%-0.8% of Mo, 0.8%-1.5% ofCu, 0.6-0.8% of C, 0.1%-0.5% of a binding agent and the balance Fe and impurities. According to the material, an existing powder forging material PF46 xx system raw material is optimized so as to obtain the material with the better performance, existing small-modulus gears are machined and formed, for a flexible material (HRC is equal to 30 or so), the subsequent carburization treatment can causeprecision reduction, so that the requirements cannot be met, for a harder material (HRC is greater than 50), machining is difficult or cannot be conducted at all, heavy-load gears with the small modulus can be manufactured by utilizing the components of the material and the powder forging method, the mechanical property can be met, and the precision requirements can further be met.