The invention relates to a traditional Chinese medicine composition for treating skin diseases. The composition is prepared from oyster, turtle shell, stir-baked squama manitis, dragon blood, herba artemisiae scopariae, felwort, cape jasmine, scutellaria baicalensis, lalang grass rhizome, semen plantaginis, rhizoma alismatis, radix bupleuri, salviae miltiorrhizae, dried radix rehmanniae, rhizoma atractylodis macrocephalae, poria cocos, rheum officinale, raw hawthorn, pawpaw, radix rehmanniae preparata, rhizoma sparganii, curcuma zedoary, ligustrum lucidum ait, angelica sinensis, radix paeoniae rubra, radix paeoniae alba, ligusticum wallichii, peach kernels, safflower carthamus, pericarpium citri reticulatae viride, pseudo-ginseng, earthworm, pericarpium citri reticulatae, radix curcumae, fructus lycii, fructus aurantii, rhizoma cyperi, rice sprout, malt, codonopsis pilosula, astragalus membranaceus and licorice root. The composition can be used for treating heat entering construction-blood and toxic heat flourishing, has the effects of clearing heat, cooling blood and relieving dizziness and itching, and is mainly used for treating erythroderma desquamativum, skin-loss type diseases, psoriasis, argyraemia and psoriasis.