The invention relates to a lithium niobate-based PM-QPSK integrated light modulator and a working method thereof. The lithium niobate-based PM-QPSK integrated light modulator comprises an upper electrode, a lower electrode, a lining and lithium niobate crystals, wherein a polarization demultiplexer, two IQ modulators in parallel and a polarization multiplexer are sequentially etched on the lithium niobate crystals in a light path direction; the upper electrode and the lower electrode are respectively arranged on the upper surface of the lithium niobate crystals and below the lining; the polarization demultiplexer and the polarization multiplexer are respectively a lithium niobate polarization demultiplexer based on MZI and a lithium niobate polarization multiplexer based on MZI. As the lithium niobate-based PM-QPSK integrated light modulator is provided with the lithium niobate polarization demultiplexer and the lithium niobate polarization multiplexer manufactured on a birefrigent effect of lithium niobate, the conventional method that a polarization multiplexer is manufactured on the basis of a silicon substrate is changed, a polarization demultiplexer and a polarization multiplexer based on the silicon substrate and IQ modulators are integrated on the same piece of crystal, and the allowance is far smaller than a silicon substrate process.