The invention relates to an indoor decorative material, in particular to a diatom internal wall coating with humidity-regulating and air-purifying functions and a preparation process thereof, and aims at overcoming the defects existing in the prior art and providing the diatom internal wall coating and the preparation process thereof, wherein the diatom internal wall coating has an excellent indoor air humidity-regulating function, can eliminate peculiar smell, preserve heat, reduce noise, remove harmful gases including formaldehyde, toluene and the like in the air, can continuously release negative oxygen ions, has a lasting environmental-protection function, a humidity-regulating function and the air-purifying function, and is rich in colors, strong in texture and environment-friendly. The diatom internal wall coating with the humidity-regulating and air-purifying functions and the preparation process of the diatom internal wall coating have the advantages that ingredients can be used after screened, weighed, evenly mixed in a grading mode, checked out and packaged. When the diatom internal wall coating is used, water is added into the coating to prepare a pasty or milky coating, and texture shape construction can be performed in a batch-coating, blade-coating or wipe-coating mode or in a roll-coating, spraying or brush-coating mode. An appropriate construction process can be selected according to the decorative requirements.