The invention discloses flame-retardant breathable easy-care finishing liquid for shirts and a finishing method of the shirts. The flame-retardant breathable easy-care finishing liquid is prepared from montmorillonite, trimethylethoxysilane, an emulgator T05, polyvinyl acetate emulsion, sodium lauryl sulfate, silica sol, polyethylene glycol 1000, glycol stearate, butanetetracarboxylic acid, ammonium citrate, triethanolamine, malic acid, sodium hypophosphite, boric acid, 2-2.5 parts of diphenylethylene disulfonate derivatives, amino polysiloxane, chitosan, N, N-dimethyl formamide, an emulgator NPE 108, trimethylol ethylene urea, polymethylsiloxane silicone, hydroxyl silicone oil, an appropriate amount of maleic anhydride and an appropriate amount of deionized water. The flame-retardant breathable easy-care finishing liquid for the shirts is high in attachment capability, lasting in performance after repeated washing and natural, mild and skin-friendly without irritation and makes the shirts soft but not sticky to the skin and comfortable to wear, and the shirts finished by the finishing liquid are easy to care, highly resistant to crease and wash, less prone to damage, smooth in appearance and excellent in breathability, moisture conductivity and sweat releasing performance, thereby being comfortable to wear.