The invention relates to an austenitic stainless steel with excellent polishing performance and a manufacturing method thereof. The austenitic stainless steel comprises the following components by weight: 0.03-0.1% of C, 0.3-1.0% of Si, 0.8-2% of Mn, 0-0.045% of P, 0.003-0.008% of S, 16-20% of Cr, 7-12% of Ni, 0.4-2.0% of Cu, 0-0.08% of N, and the balance Fe and unavoidable impurities. According to the invention, by controlling a proper amount of S and adding a small amount of Cu, the plasticity and cutting performance of the matrix are improved, thus being in favor of improving the polishing performance; the intake of Al in raw materials is controlled, and an Al-free deoxidant is employed, thus effectively reducing the generation probability of hard type inclusions; in addition, by controlling a suitable basicity in the smelting process, inevitable hard type inclusions are modified into plastic inclusions, and then through settling, Ar gas stirring and other measures, large inclusions can be removed, thereby effectively purifying the molten steel and improving the inner quality of steel; and non-dephosphorization rolling, a corrosive groove free pickling surface and an appropriate flattening process effectively enhance the final surface quality.