The invention discloses a medicine for treating depression, and a preparation method thereof. The medicine is prepared from bupleurum chinense, root of red-rooted salvia, acorus gramineus, thinleaf milkwort rootbark, zedoary, coptis chinensis, dragon bone, oyster, and chlorite schist in a certain weight part proportion; bupleurum chinense, root of red-rooted salvia, acorus gramineus, thinleaf milkwort rootbark, zedoary and coptis chinensis are extracted by a percolation method, dragon bone, oyster, and chlorite schist are extracted by a levigation method, then extracts are mixed, and mixed extracts and auxiliary materials are mixed to be prepared into any common oral formulation. The medicine has the effects of soothing the liver and regulating vital energy, activating blood and dissolving stasis, tranquilizing the mind, reducing phlegm and purging fire and the like, is used for treating liver qi stagnation, vexation and sleeplessness and other symptoms, and is also used for treating depression.