The invention provides a circuit breaker arc extinguishing chamber composite bushing alignment fixture and a using method thereof. The alignment fixture comprises a datum flange in positioning connection with a first mounting flange at the first end of an insulating cylinder body, a positioning column extending towards the second end of the insulating cylinder is vertically connected to the datum flange, the circuit breaker arc extinguishing chamber composite bushing alignment fixture further comprises an alignment flange in positioning fit with the positioning column to ensure the coaxiality, the alignment flange is provided with more than two datum holes for positioning the positioning holes to be machined in a flange surface to be machined, and the datum holes are located on the concentric circle of the alignment flange. When the alignment fixture is used, the datum flange is coaxially connected with the first mounting flange of the insulating cylinder body, then the alignment flange is fitted with the flange surface to be machined and coaxially positioned with the positioning column, and the center of the circle where the datum holes are located in the alignment flange is thus on the same straight line as that of the circle where the positioning holes of the first mounting flange, that is, coaxiality of dynamic and static contacts mounted on the mounting flange is realized.