The invention discloses a tatting-imitating wool-cotton rib-knitted fabric and a preparation method thereof. The preparation method comprises the following steps: (1) raw material selection; (2) twisting: respectively blending various fibers into a first yarn, a second yarn and a third yarn; (3) gray fabric weaving: weaving a rib tissue structure by taking the first yarn and the second yarn as surface yarns and the third yarn as a ground yarn; (4) scouring and bleaching: performing continuous open width scouring on a gray fabric in a solution containing sodium carbonate and a scouring agent; and (5) dyeing post-treatment: carrying out dyeing, tentering formation and decatizing preshrinking on the scoured and bleached gray fabric. According to the preparation method, the optimal yarn countstructure is designed by taking multiple soft and comfortable yarns as the raw materials, and a tissue structure is reasonably woven according to the twist degree and the twist direction, so that thestiff and smooth appearance of the fabric is realized; and by carrying out subsequent scouring and bleaching treatment and post-treatment process development, the flexible and comfortable hand feel, stuffiness and smoothness of the fabric are guaranteed.