The invention discloses a plasticized and toughened polyethylene composite material and a preparation method thereof. The plasticized and toughened polyethylene composite material comprises the following raw materials in parts by weight: 10-50 parts of polyethylene, 40-60 parts of polyphenylene sulfide, 70-80 parts of dimethyl trimethyl phosphate, 70-100 parts of ethoxy ethyl acetate, 40-80 parts of cyclohexanone, 70-90 parts of sodium stearate, 40-60 parts of graphite, 50-80 parts of a stabilizer, 50-90 parts of an accelerant and 40-100 parts of rubber. The preparation method comprises the following steps: mixing polyethylene, polyphenylene sulfide and dimethyl trimethyl phosphate evenly; heating to 50-60 DEG C and reacting for 20-30 minutes; cooling, adding residual components; mixing evenly on a high-speed stirrer; and extruding and pelletizing the evenly mixed granules through a twin-screw extruder. According to the plasticized and toughened polyethylene composite material obtained by the method, the breaking strength is 70-78MPa; the charpy notched impact strength is 23-28KJ.m<2>; the tensile strength is 130-140MPa; and the plasticized and toughened polyethylene composite material has good toughening and speed-increasing effects.