The invention discloses oil-containing sludge coal slurry and a preparation method thereof. The oil-containing sludge coal slurry comprises the following components in percentage by mass: 57-62% of coal powder, 3-14.3% of oil-containing sludge, 0.2-0.7% of a dispersing agent and water, totaling 100%. The method comprises the following steps: uniformly mixing the oil-containing sludge and the coal powder to obtain a mixture A; and uniformly mixing the mixture A, the water and the dispersing agent to obtain the oil-containing sludge coal slurry. The oil-containing sludge coal slurry disclosed by the invention is easily available in raw material, good in fluidity, high in slurry concentration, and quite high in conversion rate when being applied to combustion and gasification.