The invention relates to a medicine used for treating decompensated liver cirrhosis, and a preparation method thereof. Currently, decompensated liver cirrhosis is treated by liver protection, human plasma albumin and diuretic intravenous supplement, repeated ascites paracentesis, and the like. The treatment course is long, and treatment effect is poor. The medicine provided by the invention comprises: Mongolian milkvetch root, largehead atractylodes rhizome, swordlike atractylodes rhizome, agaric, florist's chrysanthemum, Asiatic plantain seed, common yam rhizome, ginseng, stir-fried malt, stir-fried medicated leaven, salvia miltiorrhiza, radix saussureae, hawthorn fruit, dandelion, mix-fried scale, mix-fried turtle shell, peach seed, rhubarb, composite protein powder, lecithin vitamin E, and colostrum capsules. The medicine provided by the invention is used for treating decompensated liver cirrhosis diseases. The medicine has the functions of hard mass softening, stasis removing, spleen invigorating, and dampness removing. Through liver protection, dieresis, and nutritional immunology effect improving, ascite is discharged. The medicine has a good treatment effect against decompensated liver cirrhosis after alcoholic hepatitis or viral hepatitis.