The invention relates to vegetable insulating oil based on vegetable oil, and a preparation method of the vegetable insulating oil. The insulating oil is prepared by the steps of using refined vegetable oil as raw material, carrying out ester exchange reaction on low-molecular alcohol, refining and washing after the reaction, rinsing, distilling under reduced pressure in order to remove water and alcohol, de-coloring, de-acidifying, filtering, de-watering deeply, finally adding antioxidant and pour point depressant. The insulating oil prepared by the method has the characteristics of high flashing point, low viscosity, low pour point, low acidity, low brackish water content, excellent dielectric constant, low dielectric loss and high breakdown voltage and has good physical and chemical performance and electrical performance.