The invention relates to a micropowder medicament for treating bone fractures such as fracture, paralysis, osteonecrosis and bone fracture sequelae which are caused by trauma and the like and a preparation method thereof. The micropowder medicament comprises the following raw material medicaments: 4 to 7 parts of pyrite, 2 to 5 parts of herry rhodiola, 2 to 5 parts of frankincense, 2 to 5 parts of myrrh, 1 to 5 parts of safflower, 1 to 4 parts of garden balsam stem, 3 to 5 parts of prepared rhubarb, 2 to 5 parts of dioscorea nipponica, 3 to 6 parts of sea cucumber, 1 to 2 parts of gecko tail, 3 to 7 parts of pyrolusite and the like. The preparation method comprises the step of grinding the raw material medicaments into fine powder with the grain diameter of 300 to 1,000 meshes by a low-temperature freeze drying method, and preparing capsules for oral administration, or blending on site to form paste for external application; moreover, the medicament can be used for oral administration and external application simultaneously. The micropowder medicament has the excellent effect on closed fracture except for head injury, and particularly for traumatic patients who suffer from the bone fractures, both the trauma and the bone fractures can be treated. By the invention, more patients who suffer from the bone fractures and particularly serious patients do not suffer from amputation, do not need wheelchairs, and are recovered quickly, without sequela.