The invention discloses a flame-retardant plastic packaging material and a preparation method thereof. The flame-retardant plastic packaging material is prepared from the following components by weight: 7 to 11 parts of cross-linked polyethylene, 45 to 65 parts of polyethylene, 15 to 40 parts of a composite intumescent flame retardant, 3 to 5 parts of a flexibilizer and 4 to 7 parts of talcum powder, and the intumescent flame retardant is prepared from, by weight, 0.8 to 1.2 parts of phosphoric pentoxide, 1 to 3 parts of phosphoric acid, 0.5 to 1 part of starch and 2 to 4 parts of a foaming agent. Compared with the prior art, the flame-retardant plastic packaging material has the following advantages: due to addition of the halogen-free composite intumescent flame retardant, the flame retardation performance of plastic is improved and a heat insulation carbonization film can be formed during combustion and covers the surface of a plastic matrix, so the matrix is protected and good flame retardation effect is obtained. The flame-retardant plastic packaging material provided by the invention has low toxicity, good smoke suppressing effect, low cost and excellent anti-static functions and is a flame-retardant packaging material with outstanding comprehensive properties.