The invention discloses a rare-earth-ion-doped LuI3 microcrystalline glass and a preparation method thereof. The microcrystalline glass is composed of the following components in percentage by mole: 30-40 mol% of P2O5, 25-30 mol% of B2O3, 7-15 mol% of BaF2, 5-9 mol% of Lu2O3, 15-20 mol% of LuI3 and 1-4 mol% of LnI3. The LnI3 is CeI3, EuI3, TbI3, PrI3 or NdI3. The preparation method comprises the following steps: preparing P2O5-B2O3-BaF2-Lu2O3-LuI3-LnI3 glass by a fusion process, and carrying out heat treatment to obtain the transparent LuI3 microcrystalline glass. The LuI3 microcrystalline glass has the advantages of deliquescence resistance, favorable mechanical properties, higher short-wavelength blue-violet light transmission rate, superhigh light output, quick attenuation, favorable energy resolution, favorable time resolution and the like. The preparation method of the microcrystalline glass is simple and lower in production cost.