The invention discloses a material for producing disposable tableware or industrial goods trays and a production method thereof. The material comprises the following components in parts by weight: 60-80 parts of mechanical straw pulp, 20-40 parts of chemical wood pulp or straw pulp, 2-6 parts of modified starch, 1-5 parts of waterproof agent and 0.1-1 part of oil-proofing agent. The production method comprises the following steps: uniformly mixing the components and adding water into the mixture for stirring into uniform pulp to obtain the material; adding the material to a mold and draining excess water for producing prefabricated products; putting the prefabricated products and the mold to an external mold which is heated to 170-180 DGE C by steam in advance, and closing the two molds for pressing the prefabricated products into various shapes of disposable tableware or industrial goods trays. The material mainly contains the mechanical straw pulp and has the advantages of little chemical substance contamination and low production cost. The disposable tableware or industrial goods trays produced by the material have the advantages of sanitation, low cost, favorable crispness andthe like.