The invention relates to the technical field of straw reutilization and in particular relates to an environment-friendly polyethylene thin film and a preparation method thereof. The environment-friendly polyethylene thin film is prepared from the following components in parts by mass: 25 to 35 parts of straw powder, 6 to 10 parts of a plasticizer, 1 to 2 parts of a lubricant, 0.1 to 0.2 part of an antioxidant and 55 to 65 parts of PE (Polyethylene). The environment-friendly polyethylene thin film provided by the invention has the advantages of energy saving and environment friendliness; an environment protection problem caused by straw combustion is effectively avoided and PM2.5 (Particulate Matter 2.5) can be effectively reduced; meanwhile, resources are effectively utilized, the additional value of straw is improved and the income of farmers is increased. A novel environment-friendly thin film material has good tensile and bending performance and has energy-saving and environment-friendly effects better than those of a common pure plastic film blowing material.