The invention relates to a method for producing blended yarn of Shengma fiber and cotton. A required cone yarn is produced by selecting suitable Shengma fibers and cotton fibers, combining the Shengma fibers with a cotton comber on a drawing after blowing, carding and predoubling, and performing a roving process, a spinning process and a winding process. In the method, the blowing process has the characteristics of carding more and beating less, catching frequently and rarely, low beater speed, less fly fiber, and heavier pressure; the carding process has the characteristics of suitable carding; the drawing process has the characteristics of light quantitation, heavy pressure, low speed, primary predoubling and secondary blending; the roving process has the characteristics of light quantitation, heavy pressure, low speed and high twisting degree; and the spinning process has the characteristics of low speed, high twist factor and suitable temperature and humidity. A plus material of the blended yarn of the Shengma fiber and the cotton produced by the method of the invention has cotton texture; a fabric has the characteristics of soft, smooth and fluffy handfeel, high moisture adsorption performance and ventilation property, high warmth retention property, high bacteria and mildew resistance, high drapability, bright color and luster, plump and smooth fabric surface organization, lightness and comfort for a wearer, and capacity of being used for knitted underwear, leisure wear, towel supplies, beddings and the like.