Belonging to the field of traditional Chinese medicine, the invention discloses an externally used ointment for treatment of cracked nipples and a preparation method. The ointment effective components comprise the following raw materials by weight part: barley seedling, Ilex purpurea Hassk, nephrolepis auriculata, Ficus pandurata, Polygala japonica, Nauclea officinalis, Vernonia cinerea, Pimpinella diversifolia, Green Tangerine Peel, bark of elm tree, adiantum capillus veneris, linseed, rhizoma bletillae, Herb of Obcordate Christia, Campsis grandiflora, and Leaf of Delavay Schefflera. The invention carefully selects traditional Chinese medicine formula with the efficacy of regenerating tissue to heal wound, diminishing swelling and relieving pain, relieving stagnation, nourishing blood and expelling wind, expelling pus and removing toxin, dispelling wind and drying dampness and the like to process the ointment, and all the drugs cooperate to reach lesion positions directly. The externally used ointment has the advantages of quick effect, high cure rate, no toxic or side effect, convenience and safety, lasting curative effect and the like in treatment of cracked nipples, breast swelling and heat pain, mastalgia, galactorrhea, nipple cutting pains during baby sucking, bleeding, ulcer and other symptoms, and is suitable for popularization and application in clinical treatment and nursing of cracked nipples.