A medicated thread manufacturing system and associated method includes first and second slideways, a thread clamping apparatus and a medicine spraying apparatus slidably arranged on the first slideway, and a thread winding apparatus slidably arranged on the second slideway. The clamping apparatus clamps two ends of a to-be-processed medicated thread, straightens the thread and twists the thread in the straightened state into a single-strand rope state. The spraying apparatus sprays a medicine towards a surface layer of the thread in the straightened state. The winding apparatus abuts a center position of the thread in the single-strand rope state, pulls and folds the thread, and rotates the thread such that the thread winds and extends from middle to two ends to be twisted in a double-strand rope state. A control apparatus is in signal connection and/or electrical connection to the clamping apparatus, the spraying apparatus and the winding apparatus.