The invention relates to a method for preparing a thermoplastic elastomer through dynamic vulcanization, which comprises the following operation steps: (1) preparation of a reactive first-step material, namely, fusing and blending raw materials comprising part of rubber, plastics, a stuffing, a softener, an aging agent and a processing aid except a vulcanizing agent and an accelerant for granulation; (2) preparation of vulcanizing agent master batch, namely, blending the vulcanizing agent and part of the rubber for granulation; (3) preparation of accelerant master batch, namely, blending the accelerant and part of the rubber for granulation; and (4) dynamic vulcanization, namely, mixing the reactive first-step material, the vulcanizing agent master batch and the accelerant master batch prepared by the three steps for dynamic vulcanization. The elastomer prepared by the method has the characteristics of high fluidity, high elasticity and low hardness; and the process has the advantages of wide equipment application, simple preparation processes, wide processing window and the like.