The invention discloses a traditional Chinese medicine formula for treating poultry muscular stomach and glandular stomach inflammation and a preparation method thereof. The formula is composed of the following traditional Chinese herbals in parts by weight: 21 to 25 parts of rhizoma atractylodis, 16 to 20 parts of bighead atractylodes rhizome, 10 to 14 parts of banksia rose, 10 to 14 parts of green tangerine peel, 10 to 14 parts of villous amomum fruit, 13 to 17 parts of bletilla striata, 7 to 11 parts of licorice, 16 to 20 parts of cuttlebone, 16 to 20 parts of concha arcae, 16 to 20 parts of limonite, 16 to 20 parts of oyster, 10 to 14 parts of poria cocos, and 13 to 17 parts of dandelion. The formula can be made into powder. The rhizoma atractylodis is acrid and aromatic, has the functions of dispelling evil, drying dampness, invigorating the stomach, and repelling foulness, and is assisted by the following components: bighead atractylodes rhizome having functions of boosting qi and invigorating spleen, banksia rose having functions of moving qi and relieving pains, green tangerine peel having functions of breaking qi and removing food retention, villous amomum fruit having functions of invigorating stomach and promoting digestion, cuttlebone, concha arcae, limonite, oyster, wherein cuttlebone, concha arcae, limonite, and oyster have the functions of producing acid and eliminating swelling; bletilla striata having functions of stopping bleeding and promoting tissue generation, poria cocos, and dandelion, wherein poria cocos and dandelion have the function of inducing diuresis to alleviate edema. The traditional Chinese medicine formula can treat the poultry muscular stomach and glandular stomach inflammation, at the same time can promote the regular operations of blood, qi, and fluids in poultry body, brings the metabolism of poultry to a normal state, and thus treats both the root and symptoms. After healing, the poultry has a good appetite, the growth is good, and relapse is difficult.