The invention relates to an Fe-Ga based magnetostrictive wire and a preparation method thereof. The raw material component used by the method is (Fel-x-yGaxMy)l-z(NC)z, wherein M is selected from one or more types of all transition elements other than Fe, B, Be, Al, In, Ge, Sn, Sb, Bi, Pb, S and Se, and N is Nb, Ti, Si, Zr, Mo and the like, x is equal to 0.10 to 0.30, y is equal to 0.00 to 0.05, z is equal to 0.00 to 0.02, and the balance Fe. The method processes an Fe-Ga alloy into a finished wire through cold- or warm-hydrostatic extrusion. The invention solves the problems of poor plasticity, larger flow friction resistance and high processing cost when in Fe-Ga alloy plastic processing. The diameter of the prepared Fe-Ga based magnetostrictive wire is between 0.01mm and 2mm, the surface finishment is high, and the magnetostrictive properties under the low-magnetic field environment can reach 180*10-6.