The invention belongs to the technical field of machine vision, and particularly relates to a frosted glass inner layer two-dimensional code recognition device and an application method thereof. The frosted glass inner layer two-dimensional code recognition device comprises a shooting device, a polarizer, a polaroid and a light source device; and the central axis of the shooting device, the central axis of the polarizer, the central axis of the polaroid and the central axis of the light source device are located on the same vertical line; the light source device is used for emitting high-brightness linear polarized light, the polarizer is movably arranged at one end of the shooting device, and the polaroid is arranged on the upper end face of the light source device. By adopting a polarization method, the imaging problem of the frosted glass inner layer laser etching code point interfered by the frosted glass background is effectively solved, the gray scale contrast ratio of the two-dimensional code point and the frosted glass background is improved, the two-dimensional code is more easily and stably read successfully, the code reading time is shortened, the visual code reading rate is further improved, and through reading of code reading software, the requirement of large variability of industrial products can be met, and the code reading accuracy can reach 99.95%.