The invention discloses a multiferroic liquid and a preparation method thereof, for solving the defects that a solid-state multiferroic material is large in coercive force, cannot be structurally changed once being formed, is low in magneto-electric coupling effect and is easily broken down by voltages. The multiferroic liquid is internally provided with a magnetic material, the outer surface of the magnetic material is wrapped by a ferroelectric material, nanometer particles with magneto-electric core shell structures are uniformly dispersed in a mixed liquid of a base solution and a surfactant, and a stable suspending liquid is formed in such a way. The multiferroic liquid has ferroelectricity and magnetism, also has fluidity and is quite small in coercive force. The length and the thickness of a nanometer chain composed of the nanometer particles in the multiferroic liquid can be adjsuted by applying different electric fields or magnetic fields to the multiferroic liquid according to needs, and accordingly, the electrical property, the magnetic property, the hydrodynamic property, the optical property and the acoustic property of the multiferroic liquid are adjusted. The invention brings forward the concept of the multiferroic liquid for the first time ever, and also provides the preparation method, expanding a new research direction for research on a multiferroic material.