The invention discloses a biomass granular fuel and a preparation method thereof, and relates to the field of development and utilization of waste biomass resources. The biomass granular fuel disclosed by the invention is prepared by the following steps: drying and crushing a biomass raw material to obtain powder, adding the lignin-based binder and the additive into the powder, uniformly stirringby virtue of a stirrer, mechanically compressing, granulating and cooling, thereby obtaining the biomass granular fuel. The lignin-based binder is obtained by adding a polyacrylic acid / urea polymer into a suspension containing lignin particles, adjusting the pH value, stirring, filtering, drying and crushing. According to the biomass granular fuel provided by the invention, by adding the lignin-based binder, the forming rate of the biomass granular fuel is increased, the biomass granular fuel is not easy to break in the transportation process, the combustion speed is stable, slag bonding is not liable to generate in the combustion process, the combustion efficiency is improved, the service life of a combustion device is prolonged, and the environmental pollution is reduced.