The invention discloses a special grinding fluid for ELID grinding aluminum matrix composite materials, and a preparation method thereof, and belongs to the field of precision ultra-precision online electrolytic dressing grinding, wherein the grinding fluid is prepared from engine oil, Span, polyaniline, sodium metasilicate, tetraethoxysilane, fatty alcohol polyoxyethylene ether, alkylphenol polyoxyethylene ether, phosphate, water-soluble organic siloxane, triethanolamine oleate, chlorinated fatty acid, nitrogen-containing borate, sodium petroleum sulfonate, polyacrylamide, isothiazolinone, sodium sulfate, sodium phosphate and tap water. According to the present invention, the grinding fluid can perform electrolytic removal on the metals in metal bonded grinding wheels and the aluminum-based grinding debris adhered to the surface of grinding wheels so as to dress the grinding wheel, and can be subjected to an oxidation reaction with the metal bonding agent exposed to the grinding wheelsurface and the aluminum matrix exposed to the processed surface to form a layer of a corrosion-resistant oxidation film for the metal bonding agent and the aluminum matrix on the grinding wheel surface.