The invention discloses a traditional Chinese medicine preparation for treating depressive disorder and anxiety disorder and a preparation method thereof. The preparation comprises the following components in portion by weight: 10 to 30 portions of prepared rhizome of rehmannia, 10 to 30 portions of Flos Albiziae, 10 to 30 portions of shelled cedar seed, 10 to 30 portions of rhizoma cyperi, 10 to 30 portions of bupleurum, 10 to 30 portions of Chinese yam, 10 to 30 portions of prepared fleece-flower root, 10 to 30 portions of gynostemma pentaphylla, 10 to 30 portions of gardenia, 10 to 30 portions of radix codonopsitis, 10 to 30 portions of angelica, 10 to 30 portions of unprocessed oyster, 10 to 30 portions of hoantchy root, 10 to 30 portions of schisandra, 10 to 30 portions of epimedium, 10 to 30 portions of spina date seed, 10 to 30 portions of milkwort, 10 to 30 portions of phellodendron amurense, 10 to 30 portions of anoectochilus formosanus, and 10 to 30 portions of uncaria. The traditional Chinese medicine preparation utilizes the efficacy of each drug to generate synergic action, and has the efficacies of relieving restlessness and soothing the nerves, nourishing the mind and replenishing the deficiency, soothing the nerves and benefitting the intelligence, reducing phlegm and dredging acupuncture points, nourishing the mind and protecting the liver, promoting Qi circulation and removing obstruction in the collateral, and relieving melancholy, anxiety and insomnia so as to effectively treat the depressive disorder and the anxiety disorder.