The invention discloses a medicine for treating seborrheic dermatitis and a preparation method thereof. The medicine is mainly prepared from the medicines such as uniflower swisscentaury root, oldenlandia diffusa, artemisia capillaris, almond, silkworm larva and red halloysite at a certain weight ratio. The medicine disclosed by the invention has the functions of clearing heat and removing toxicity, promoting dampness and removing stasis, and drawing out toxicity and diminishing swelling, and is fast taking effect, good in curative effect and free from toxic and side effects in case of being used for treating seborrheic dermatitis.