OBJECTIVE To evaluate the innovation and sustainable development ability of traditional Chinese medicine(TCM) preparation in medical institutions, and to provide reference for the decision-making of administrative departments and the sustainable development of TCM preparation in hospitals. METHODS Based on the information data of 133 medical institutions in Zhejiang Province, analytic hierarchy process was used to construct the evaluation system of innovation and sustainable development ability of TCM preparation of medical institutions, and the prediction model of evaluation system of TCM preparation room/center was built by back propagation neural network. RESULTS The evaluation index system for innovation and sustainable development of TCM preparations in medical institutions included 4 second-level indexes and 19 third-level indexes. Among them, the number of varieties developed, the number of over one million varieties, the number of registered varieties, the way of research and development, and the area of preparation room had higher weight values, which were 0.15758, 0.12928,0.09343, 0.07879 and 0.07458, respectively. The entropy weight method and analytic hierarchy process index weights were used to construct the back propagation neural network. The overall correlation coefficients of the training models of the Levenberg-Marquardt algorithm and the Scaled Conjugate Gradient algorithm were 0.98983 and 0.93480, respectively. CONCLUSION This study establishes a scientific and effective comprehensive evaluation system for the innovation and sustainable development ability of TCM preparations in medical institutions, which can realize the prediction and evaluation of the comprehensive ability of TCM preparations in medical institutions.