The invention relates to the technical field of traditional Chinese medicine preparations, and particularly relates to a solution for setting bones, relaxing tendons and activating collaterals and a preparation method thereof. The solution for setting bones, relaxing tendons and activating collaterals is prepared from bioethanol, sargentodoxa cuneata, garden balsam stem, gastrodia elata, harlequin glorybower leaf and twig, lycopodium clavatum, cassia twig, homalomena occulta, notoptergium incusium, dipsacus asperoids, ficus tikoua bur, geum aleppicum, curcuma zedoary, aralia chinensis, divaricate saposhnikovia root, drynaria total flavonoids, herba siegesbeckiae, radix angelicae pubescentis, Chinese starjasmine stem, shinyleaf pricklyash root, wasp,radix cynanchi panicullati, paniculate swallowwort root, beautiful millettia root, chinese lobelia, pseudo-ginseng, radix clematidis, scorpion, radix achyranthis bidentatae, ground beeltle, ligusticum wallichii, caulis sinomenii, caulis spatholobi, camellia oil, camphor and borneol. The solution provided by the invention has the effects of setting bones, relaxing tendons, activating collaterals, expelling wind, dispersing blood stasis, relieving swelling and pain, treating traumatic injuries and promoting reunion of fractured bones, is easily transdermally absorbed by a human body, and has the advantages of being accurate in curative effect, good in treatment effect, fast in acting, safe and free of side effect.