The invention discloses a ground automatic testing instrument device with a satellite relay trace function and a testing method thereof. The testing method comprises the following steps: a signal source generates a single carrier signal with assigned frequency and power, two signals with the same frequency and regular phase difference are generated after the single carrier signal is subjected to power division by a power divider, and the two signals are sent to a to-be-tested satellite after passing through a programmable attenuator and a programmable phase shifter respectively; the to-be-tested satellite drives an antenna simulator to rotate according to the input beacons and difference signals, and transmits downwards satellite state parameters in real time; downlink remote testing data is sent to a satellite testing server after remote testing, receiving and demodulation so as to complete the processing of satellite remote testing data, and the satellite remote testing data is sent to a control computer through an LAN (local area network) network; the control computer receives the satellite remote testing data in real time, parameters of the programmable attenuator and the programmable phase shifter are set according to the attitude of the antenna simulator in remote testing, and the corresponding beacons and the difference signals are output in real time; and the above testing steps are repeated circularly until the antennal simulator indicates that a relay star is aimed, and the relay trace process is completed.