The invention discloses a self-flame retardant PBT composite material and a preparation method thereof. The self-flame-retardant PBT composite material is prepared from the following raw materials in parts by mass: 40 to 50 parts of terephthalic acid, 45 to 55 parts of 1, 4-butanediol, 15 to 25 parts of pyromellitic acid, 3 to 10 parts of guanidine sulfamate, 2 to 4 parts of amino trimethylene phosphonic acid, 1 to 2 parts of a catalyst and 10 to 15 parts of functionalized layered double hydroxides. The preparation method comprises the following steps: S1, mixing terephthalic acid, 1, 4-butanediol and a catalyst, carrying out pre-esterification reaction for 2-3 hours under the conditions of 0.1 MPa and 200-220 DEG C, then adding pyromellitic acid, guanidine sulfamate and amino trimethylene phosphonic acid, heating to 245-270 DEG C, and carrying out stirring reaction for 1-1.5 hours; and S2, vacuumizi1ng the reaction system in the S1 to 50-100 Pa, carrying out condensation polymerization at 240-255 DEG C for 3-6 hours, then adding the functionalized layered double-metal hydroxide, carrying out stirring reaction at 250-270 DEG C for 1-2 hours, and cooling and curing. According to the method disclosed by the invention, a flame-retardant substance is embedded into a PBT molecular chain, so that microcosmic molecular modification is realized, the PBT material is endowed with a self-flame-retardant characteristic, the problem of phase layering is avoided, and the mechanical strength and the mechanical property of the PBT material are greatly improved.