The invention provides a prefabricated part combined enclosing wall and an installing method thereof. The prefabricated part combined enclosing wall comprises a foundation, columns, column caps, bottom beams, wall boards and wall caps. Column foot connecting parts of the lower portions of the columns are inserted and connected to prefabricated bolts of foundation prefabricated parts and are fastened. Bottom beam tenons at two ends of each bottom beam are respectively inserted and connected into column holes formed in the lower portions of the left and right columns. Wall board grooves formed in the left and right sides of the wall boards are respectively inserted into column convex ribs of the left and right columns, and the wall board convex ribs at the lower portions of the wall boards are inserted into the bottom beam grooves formed in the bottom beams. Wall cap tenons at two ends of each wall cap are respectively inserted into the column holes formed in the upper portions of the left and right columns, and the wall cap grooves formed in the lower portions of the wall caps are inserted into the wall board convex ribs at the upper portions of the wall boards. The column caps are buckled at the tops of the columns, and the tops of the columns are inserted into the column cap grooves of the lower portion of the column caps. The prefabricated part combined enclosing wall is assembled by adopting a prefabricated part splicing method, is high in construction efficiency, strong in wind-resistant capability, attractive and durable and can be repeatedly used as required.