The invention relates to a preparation method of panipenem. Firstly, methyl acetoacetate and p-nitrobenzyl alcohol are taken as raw materials to prepare panipenem parent nucleus by six steps of reactions: ester exchange reaction, diazo reaction, enolization reaction, substitution reaction, hydrolysis reaction and ring closing reaction; then, (3R)-3-hydroxy-pyrrolidine hydrochloride, nitrobenzyl chroformate ester are taken as raw materials to prepare panipenem side chain by amidation reaction, sulfonylation reaction, nucleophilic substitution reaction and saponification reaction; finally, the prepared panipenem parent nucleus and panipenem side chain are in butt joint by condensation and are subjected to catalytic hydrolysis and imidization to obtain panipenem. The preparation method of panipenem features simple operation, mild reaction condition, friendly environment, high yield, good product purity, low cost and better industrialized production prospect.