The invention relates to low-cost diffusion source alloy for magnet grain boundary diffusion, a grain boundary diffusion magnet and a preparation method thereof. Chemical components of the diffusion source alloy comprise an element Ce, a light rare earth element LRE, a heavy rare earth element HRE and a metal element M, and are shown as Cex(LREaHRE1-a)yM100-x-y according to atomic percentage, wherein 0< x< / = 20, 15< / = y< / = 99.9 and 15<x+ y< / = 99.9, 0< / = a< / = 1.0; LRE is one or more of La, Pr, Nd and Y; HRE is one or more of Tb, Dy and Ho; and M is one or more of Al, Cu, Zn, Ga, Ag, Pb, Bi andSn. The light rare earth element, particularly cerium, is used for partially replacing a heavy rare earth element, raw material costs of the diffusion source alloy is reduced, the melting point of thediffusion source alloy is adjusted, by improvement of the diffusion efficiency of the heavy rare earth element, the coercivity temperature coefficient of the grain boundary diffusion magnet is increased, and the high-temperature stability of the grain boundary diffusion magnet is improved.