The invention provides cordyceps cicadae composite medicine for treating diabetic nephropathy and a preparation method thereof and belongs to the field of traditional Chinese medicine. The cordyceps cicadae composite medicine for treating diabetic nephropathy is prepared from the following raw materials in parts by weight: 18 to 22 parts of cordyceps cicadae, 14 to 16 parts of radix rehmanniae, 14to 16 parts of common yam rhizome, 8 to 12 parts of fructus lycii, 8 to 12 parts of fructus corni, 8 to 12 parts of achyranthes root, 14 to 16 parts of fried radix astragali seu hedysari, 8 to 12 parts of radix salvia miltiorrhizae, 8 to 12 parts of poria with hostwood and 5 to 7 parts of chamomile flower. The composite medicine has scientific and rigovous compatibility and complete assistant andguide and has the effects of tonifying qi and yin, promoting blood circulation to remove blood stasis, nourishing liver and kidney and can achieve an effect of treating both symptoms and root causeson the diabetic nephropathy. Research data show that aqueous extract of the cordyceps cicadae composite medicine can effectively inhibit aldose reductase and reduce expression of TGF-beta1 protein, alpha-SMA protein and FN protein of renal tubular epithelial cells; thus, damage to the glomerulus cells is reduced, glomerular sclerosis is relieved, tubular interstitial fibrosis is inhibited, pathological change of the kidney is lightened, illness state development can be inhibited and converted, and a better treating and protecting effect on the diabetic nephropathy is achieved.