The invention relates to a low smoke zero halogen composite material with functions of water resistance, fire protection and flame retardance. The material comprises the following raw materials in percentage by weight: 70-80 polyethylene (PE) resin, 10-20 plasticizer, 2-5 stabilizing agent, 2-3 lubricant, 5-10 flame retardant, 1-2 PE (Polyethylene) foaming agent, 2-3 hydrophobing agent, 10-20 carbonizing agent, 1-3 elastomer (TPE) and 10-20 PE synthesizing agent. The composite material can be produced to corresponding products or functional structure layers of the products through the extrusion moulding, and is mainly applied in the products or the functional structure layers, such as outer sheath layers of electric cables and electric wires, floors, wall plates, ceilings, fire resisting shutters and the like. The composite material has the advantages of excellent water resistance, fire protection, heat insulation, smoke prevention, ageing resistance, corrosion resistance and the like.