This invention relates to a Chinese medicinal formulation for the treatment of inflammatory bowel diseases, and a method of preparation thereof. The formulation comprises herbal components selected from a group consisting of Radix Codonopsis (Dangshen), Rhizoma Atractylodis Macrocephalae (Bai Zhu), Sclerotium Poriae Cocos (Fu Ling), Rhizoma Zingiberis Officinalis (Gan Jiang), Radix Paeoniae Alba (Bai Shao) and Rhizoma Coptidis (Huanglian).