The invention provides a traditional Chinese medicinal composition for reducing blood sugar and blood pressure and a preparation method thereof. The traditional Chinese medicinal composition comprises ginseng, glossy ganoderma, yam, acanthopanax bark, astragalus, largehead atractylodes rhizome, medlar, solomonseal rhizome, sea horse, atractylodes rhizome, pseudo-ginseng, kudzuvine root, goldthread, prepared rehmannia root, fragrant solomonseal rhizome, dendrobium, dwarf lilyturf tuber, tuber fleeceflower root, poria, anemarrhena, tall gastrodia tuber, Chinese magnoliavine fruit, epimedium, bee glue, mulberry leaves and other traditional Chinese medicinal materials; and the traditional Chinese medicinal composition can be prepared into various formulations through operable processes. The traditional Chinese medicinal composition has the curative effects of strengthening spleen and nourishing yin, benefiting qi and nourishing blood, reducing blood sugar and blood pressure, improving immunity and the like, is simple in process and low in cost, and is suitable for medicating diabetes and hypertension patients, particularly middle aged and old people.