The invention discloses a nitrogen-doped graphene quantum dot and a preparation method thereof. The preparation method comprises the following steps: mixing a precursor pyrene with 80-100ml of fuming nitric acid, performing backflow stirring, performing nitro functional treatment on the surfaces of pyrene crystal grains, taking out the reactant, filtering to remove acid, adding a proper amount of NaOH, adjusting the pH value to 7, performing 300W ultrasonic dispersion treatment, transferring to a polytetrafluoroethylene tank, performing hydrothermal reaction, naturally cooling, taking out the reactant, filtering, dialyzing, and drying so as to obtain a graphene quantum dot; stirring the graphene quantum dot with ammonia water, sufficiently and uniformly mixing, transferring into a polytetrafluoroethylene tank, performing high-temperature high-pressure hydrothermal reaction, naturally cooling, taking out the reactant, and performing filtration dialysis, thereby obtaining the nitrogen-doped graphene quantum dot with excellent optical properties. The nitrogen-doped graphene quantum dot is simple in synthesis process step, high in yield, high in finished product rate and few in impurity. The nitrogen-doped graphene quantum dot disclosed by the invention can be stably dispersed in water, and is stable in structure, excellent in optical property and rich in group in surfaces.