The invention relates to blood sugar reducing healthy tea and a preparation method thereof. The blood sugar reducing healthy tea is prepared by the following steps: using guayaba leaves, cassia bark, momordica grosvenori and jasmine tea as raw materials; cleaning and removing impurities and rotten bad raw materials, drying at 50-85 DEG C and crushing, sieving by a vibration sieve; taking 20-60mu of raw materials, mixing according to the proportion, sterilizing and packaging. The invention has the advantages of special formulation, accurate treatment effect, convenient use, low cost and safety without toxic and side effects, has the functions of clearing heat and enriching the saliva, tonifying spleen and resolving dampness, and reducing blood sugar and lipid, and is suitable to patients with abnormal glucose tolerance and mild diabetes mellitus. Tests show that the invention has the functions of reducing blood sugar, lightening insulin resistance, increasing the sensitivity of insulin, protecting the function of Beta cells, and lowering serum total cholesterin and serum triglyceride without toxic and side effects.