The invention relates to the technical field of plastic alloy, in particular to low-smoke fireproof PVC/ABS alloy and a preparation method thereof. The alloy mainly comprises ABS resin, a fire retardant, a compatilizer, a smoke suppression agent, PVC resin, a stabilizer and a lubricating dispersant. The preparation method comprises the following steps of: uniformly stirring the ABS resin, the fire retardant, the compatilizer and half lubricating dispersant and feeding the mixed material into a twin-screw extruder from a main feeding port; stirring the PVC resin, the stabilizer and the other half lubricating dispersant at a high speed and then feeding the mixed material into the twin-screw extruder from a middle segment by using a lateral feeder; and fusing and mixing the mixture and performing uniform extruding granulation to obtain the low-smoke fireproof PVC/ABS alloy. The low-smoke fireproof PVC/ABS alloy has high color stability, high fire resistance and high mechanical performance, has the characteristic of low smoke when the alloy is combusted and therefore is widely applied in electronics and appliance industries.