The invention relates to a shelled shrimp chili sauce and a preparation method thereof. The shelled shrimp chili sauce is characterized by being prepared from the raw materials in parts by weight: 3 to 4 parts of fortune's drynaria rhizome, 4 to 5 parts of Chinese angelica, 2 to 3 parts of Japanese thistle herb or root, 3.5 to 4 parts of rhizome of large-headed atractylodes, 4 to 5 parts of leonurus heterophyllus, 1 to 2 parts of bitter herbs, 2 to 3 parts of gerbera, 30 to 34 parts of shelled shrimps, 300 to 350 parts of broad bean paste, 2 to 3 parts of olive oil, 12 to 14 parts of peanuts, 15 to 18 parts of chickpeas, 50 to 55 parts of red peppers, 3 to 4 parts of honey, 10 to 12 parts of white vinegar, 3 to 4 parts of toadstool, 2 to 3 parts of fragrant mushrooms, 32 to 35 parts of glutinous rice, and 7 to 8 parts of nutrition additives. The shelled shrimp chili sauce is spicy and refreshing, and appetite can be whetted; at the same time, the shelled shrimp chili sauce is rich in nutrition, and the added shelled shrimps contain rich proteins, vitamins A and minerals of potassium, iodine, magnesium, phosphorus and the like, so that bodies can be benefitted; in addition, the shelled shrimp chili sauce further contains various Chinese herbal medicine components, so that if users often eat the shelled shrimp chili sauce, the efficacies of tonifying kidneys and strengthening bones, replenishing blood and activating blood circulation, harmonizing spleens and stomachs and benefiting stomachs, and clearing heat and removing toxicity can be achieved.