The invention discloses an electrolytic machining conical small-hole machine tool and an electrolytic machining method thereof. A cathode of the machine tool is connected with a negative electrode ofa power source, a workpiece is connected with a positive electrode of the power source, in the electrolytic machining process, electrolyte in an electrolyte pond flows out of the cathode, and a feeding device drives a spindle to move in the z direction. A workbench comprises a y-direction displacement table capable of moving relative to a body of the machine tool in the y direction, and an x-direction displacement table capable of moving relative to the body of the machine tool in the x direction. An electrochemical reaction solution container is further arranged on the workbench, and an electrochemical reaction solution and a fixing block connected with the negative electrode of the power source are contained in the electrochemical reaction solution container. By means of the device and method, the cathode is manufactured, and the beneficial effects that the forming precision is high, the coaxiality is good, the linearity is good, the machining efficiency is high, and the cost is loware achieved. Two kinds of machining of electrolytic manufacturing of the conical cathode and electrolytic machining of a conical small hole can be achieved on one machine tool, and repeated mountingerrors caused by secondary clamping are avoided.