The invention belongs to the field of traditional Chinese medicine, and particularly relates to a bone setting capsule for treating traumatic injuries. The bone setting capsule is pure Tibetan medicine and is to be taken orally. The bone setting capsule comprises pearl, alabaster, orthoclase, ruddle, gypsum rubrum, ash bark, and active ingredients, i.e. lindenleaf torricellia bark leaf, oxytropisreniformis, pseudo-ginseng and iguana that are processed. The preparation method comprises the steps of treating before feeding, processing, compounding, smashing, sterilizing, sieving, mixing, packing and warehousing. The bone setting capsule has functions of promoting blood circulation to remove blood stasis, reducing swelling, easing pain, and promoting reunion of fractured bones and the like.The bone setting capsule has an obvious pain relieving effect in treating the soft tissue injury, comminuted fracture, old injury, fracture of extremities, sudden sprain in the lumbar region, chest pain in the breathing process, extravasated blood coagulation, osteonecrosis at early and medium stages, vertebral compression fracture, osseous lesion, prolapse of lumbar intervertebral disc and the like, takes effect fast, is good in curative effect, short in treatment course, easy to use, safe and reliable, and has no side effect; the clinical effective percentage of the bone setting capsule is very high; and the bone setting capsule has a high reputation in Amdo of Tibetan and peripheral areas, and is well received by many people and patients.