The invention discloses a preparation method of an organic substrate for raising rice seedlings. The substrate consists of a fermented mixed material of vinegar residue, cassava residue and straw powder, coconut chaff wet materials, plant ash, grass carbon and vermiculite. The preparation method comprises the following steps: airing crop straws, and crushing the crop straws into particles of which the sizes are smaller than 5mm; composting, thoroughly decomposing and fermenting the mixed material by using fermentation strains containing beneficial microorganisms, wherein the vinegar residue accounts for 25-35 percent, the cassava residue accounts for 40-50 percent, and the straw powder accounts for 15-25 percent; adding the coconut chaff wet materials, the plant ash, the grass carbon, the vermiculite, a compound fertilizer, a synergist and chlormequat chloride; fully stirring and uniformly mixing the raw and auxiliary materials, and then performing bagging, weighing, packaging and warehousing. Organic wastes serve as raw materials, so that the nutrition is comprehensive; pest and disease damages and worm eggs are eliminated due to fermentation by virtue of the beneficial microorganisms, the application effect is particularly good, and the method is suitable for raising the rice seedlings, can promote the healthy growth of the seedlings and can be popularized and applied all over the country.