A thermoplastic starch (TPS) comprises (in weight parts) 20-80 parts of starch, 5-40 parts of biodegradable polyester prepolymer, 0.01-10 parts of reaction activator, 0.01-1.0 part of catalytic deactivator, 0.01-1.0 part of antioxidant, and 5-50 parts of auxiliary agents. The said prepolymer has a molecular weight of 10,000-100,000 Daltons, a viscosity range of 0.30-1.2 dL/g, which is measured by Ubbelohde viscometer method, and a melting point range of 60-180°C. The terminal reactive group content of the prepolymer is 1.0-20.0 meq/Kg, which is measured by a terminal group titration process. A polyester/starch composite material comprising the TPS and its preparation method are also provided.