The invention provides a plant extract yeast lotion composition with a moisture retention function and a preparation method thereof. The lotion composition is prepared from tara gum, licorice root extracts, bifidobacterium longum lysate, bacillus fermentation products, yeast extracts, sodium hyaluronate, acetyl chitosamine, dipotassium glycyrrhizinate, 1,3-propylene glycol, polyethylene glycol, EDTA disodium and the balance water and preservative. The preparation method includes the following steps that after sodium hyaluronate, acetyl chitosamine, dipotassium glycyrrhizinate, 1,3-propylene glycol, polyethylene glycol and EDTA disodium are mixed with water, the temperature is preserved at 85 DEG C, so raw materials are completely dissolved and then cooled to 50 DEG C, tara gum, licorice root extracts, bifidobacterium longum lysate, bacillus fermentation products, yeast extracts and preservative are added and evenly stirred, and the plant extract yeast lotion composition is obtained. The composition does not contain essence or pigment, so the whole formula is safer.