The invention relates to an environment-friendly inner wall dry powder latex coating and a preparation method thereof. The compositions according to weight percentages are as follows: 10-40% of re-dispersible polymer latex powder, 10-40% of titanium dioxide, 10-40% of ground calcium carbonate, 5-20% of calcined kaolin, 5-10% of talcum powder, 0.1-0.5% of cellulose ether, 0.2-0.6% of solid defoamer, 0.2-1.0% of multifunctional auxiliary agent, and 0.01-10% of tinting pigment. The inner wall dry powder latex coating formed in the invention can have scumble construction after thinning by being added with two to three times of water, and the thickness of dry film is 20 microns to 200 microns; the color is tunable; the storage is stable, and the transportation is convenient; the VOC thereof cannot be detected (real zero VOC), and the coating film performances meet the technical requirements of national standard of inner wall latex coating; and the combination properties of products can reach international most advanced level of similar products.