The invention discloses a high-modulus magnesium alloy and a preparation method thereof. The magnesium alloy comprises the following components in percentage by weight: 0-19.5wt% of Y, 0-13wt% of Gd,0-2wt% of Zn, 0-3.0wt% of Ni, 4-6wt% of Al, 3-6wt% of Li, 0.3-0.6wt% of Zr, 0-2wt% of Ag, and the balance of Mg and inevitable impurities, wherein the total amount of the impurities is less than 0.12wt%. In the alloy system, aluminum and lithium e added to generate an equilibrium precipitated phase AlLi during solidification, which can greatly increase the elastic modulus of the alloy; in addition to the phase, zirconium reacts with aluminum to generate an Al3Zr phase, and rare earth elements Y and Gd generate a large amount of second phase in the alloy, which all increase the elastic modulus of the alloy to some extent. In addition, after solid solution aging, more precipitated phase AlLi isprecipitated in the alloy to further increase the elastic modulus of the alloy, and the elastic modulus is up to 52-55 Gpa, which can meet the requirements of the engineering field for lightweight high-modulus magnesium alloy materials. The high-modulus magnesium alloy has a good application prospect in the aerospace field.