The present invention discloses a high-yield gamma-polyglutamic acid production gene engineering bacterial and a fermentation production method thereof. The gene engineering bacterial is named Bacillus subtilis FRD518, wherein the preservation number is CGMCC NO.6772, and the Vitreoscilla hemoglobin gene (vgb) is recombined and integrated on the chromosome of the gene engineering bacterial, such that the Vitreoscilla hemoglobin VHb can be successfully and highly expressed so as to significantly improve the oxygen utilization rate of the recombinant Bacillus subtilis under a low dissolved oxygen condition. According to the present invention, during a fermentation process, a carbon source, sodium glutamate, a yeast extract and other components are added in a flow manner, such that the gene engineering bacterial can efficiently produce the gamma-polyglutamic acid in a high yield manner, wherein the yield achieves more than 65 g/L, and is increased by 147% compared with the yield of the single batch culture of the original wild strain; and with the gene engineering bacterial, the problems of low yield, more by-products, long period, high energy consumption and the like of fermentation of the gamma-polyglutamic acid gene engineering bacterial under high viscosity and dissolved oxygen limiting conditions are solved, and the gamma-polyglutamic acid gene engineering bacterial can be applied for large-scale industrial production of gamma-polyglutamate acid.