The invention provides an N-trimethyl chitosan microsphere, a preparation method thereof and application of the microsphere in reduction of dielectric loss of vegetable oil, belonging to the field ofmodified chitosan. The preparation method of the N-trimethyl chitosan microsphere comprises the following steps: carrying out hybrid reaction on chitosan with the visocisty of 0.25-0.65Pa.s, sodium iodide and N-methyl-2-pyrrolidone, then adding sodium hydroxide and methyl iodide, reacting, then carrying out ethanol precipitation, separating, and carrying out freeze drying, thereby obtaining N-trimethyl chitosan with the quaternization substitution degree of 10-20%; preparing N-trimethyl chitosan into solution, spraying into sodium polyphosphate, reacting, washing with water, adding into sodiumhydroxide solution, stirring, adding glutaraldehyde, and reacting, thereby obtaining the microsphere; and washing the microsphere with water, then sequentially eluting with organic solvents with thevolume fractions of 21-29%, 41-49%, 61-69% and 85-89%, and carrying out freeze drying. The modified chitosan prepared by adopting the method can reduce the dielectric loss of the vegetable oil.