The invention discloses a preparation method of phosphogypsum-based anti-cracking mortar applied to interior insulation of an external wall. The preparation method is characterized in that the anti-cracking mortar comprises the following components in percentage by mass: 40-80% of building phosphogypsum, 20-50% of dried sand, 0-20% of cement, 0-5% of fly ash, 0-0.2% of a high-performance plasticizer, 0-0.2% of a thixotropic agent, 0.1-0.3% of a water-retaining agent, 0.01-0.4% of a gypsum retarder, 0-3% of a micromolecular polymer and 0-0.25% of anti-cracking fiber. According to the preparation method, the building phosphogypsum prepared by washing and calcining industrial byproduct phosphogypsum is used as a cementing material, so that the problems that a cement-based material is easy to shrink, hollow and crack are solved; through full use of the characteristics of fast setting and hardening, good volume stability and low own ratio of compressive strength to flexural strength of a gypsum material, the anti-cracking mortar, of which the ratio of the compressive strength to the flexural strength is lower than 2.5, the operable time is 1-2h, the final setting time is shorter than 3h, the insulation board bonding strength is higher than 0.10MPa and breakage occurs inside an insulation board, is prepared. The anti-cracking mortar is applied to the interior insulation of the external wall and low in cost, reduces the environment pollution, and is simple in production process, low in energy consumption and good in product performance; compared with other insulation board crack resisting products, the anti-cracking mortar has higher market competitiveness and is strong in practicality.