The invention discloses a preparing method of high-performance soft magnetism composite materials. The preparing method comprises the steps of iron powder sorting matching, insulation wrapping, pressing forming, high-temperature annealing, ternary grinding, soaking, baking and the like. High-purity water atomization iron powder and carbonyl iron powder are used for being mixed, the phenomena of a peak or double peaks can be effectively avoided, meanwhile, normal distribution is good, and the pressed density of an iron core component is effectively improved. Nanometer silicon nitride and aluminum nitride dielectric materials are used for wrapping iron powder, iron powder oxidation is effectively avoided, and eddy-current loss can be well lowered. The method is simple in preparing technology, high in efficiency and complete in wrapping, magnetic loss of the iron core component can be effectively lowered through an insulation wrapping layer on the surface of the iron powder, a prepared component is low in eddy-current loss, high in saturation flux density, high in magnetic permeability and high in specific resistance, high magnetic property and high mechanical property are achieved, and the machining method is low in cost and high in forming accuracy.