A catalyst coated electrolyte membrane including an anode catalyst layer and a cathode catalyst layer at opposite sides thereof, respectively, wherein micro cracks of the anode catalyst layer or cathode catalyst layer occupy 0.01-1 area % of the total area of the respective anode catalyst layer or cathode catalyst layer, a fuel cell including the same, and a method of preparing the catalyst coated electrolyte membrane. In the catalyst coated electrolyte membrane, micro cracks of the cathode catalyst layer or the anode catalyst layer can be minimized and thus the resistance between the electrode catalyst layer and an electrolyte membrane can be minimized, and crossover of a fuel, such as methanol, ethanol, other alcohols, methane, etc., to a cathode electrode can be minimized, and thus the catalyst coated electrolyte membrane has improved performance and durability.