The invention relates to the technical field of chemical industry, and especially relates to a method for preparing potassium dihydrogen phosphate and preparing a special fertilizer for peony as a byproduct. The temperature and other coefficients of the preparation technology of potassium dihydrogen phosphate from phosphoric acid through a wet process are changed, so the purity of the potassium dihydrogen phosphate product is improved, and the N, P and K compounded fertilizer is produced; and formaldehyde is added to a filtrate to prepare the controlled release compound fertilizer. The method improves the purity of potassium dihydrogen phosphate, and the produced special fertilizer for peony has high absorptivity, can meet the nutrition needs of peony in all stages of the growth period of peony, and is an efficient compound fertilizer.