The invention provides a self-cooling vertical stone machining tool and a manufacturing method thereof. The self-cooling vertical stone machining tool comprises a tool body and a tool handle, whereina main blade and an auxiliary blade are arranged on the tool body, a main cooling hole is formed in the tool handle, the main cooling holes are blind holes which extend into the tool body in depth, aplurality of auxiliary cooling holes extending outwards along the radial direction of the tool handle are formed in the inner wall of the main cooling hole; the manufacturing method comprises the following steps of preparing a tool blank through a sintering or chemical vapor deposition method, milling a spiral groove by using a milling machine, a main cutting edge and an auxiliary cutting edge aremachined through grinding and grinding, and a main cooling hole and an auxiliary cooling hole are machined through an electric spark punching machine. According to the adoption of the technical scheme, the polycrystalline diamond material has high hardness, the cutting performance of the tool is greatly improved, the cooling liquid flows through the main cooling hole and the auxiliary cooling hole to cool the tool, the situation that the local area of the tool is excessively heated is avoided, the tool is protected, the service life of the tool is prolonged, the structural strength of the tool is high, and the workpiece machining quality is improved.