OBJECTIVE To establish the project approval evaluation system for traditional Chinese medicine （TCM） preparations in medical institutions guided by new drug conversion， to improve the success rate of approval for TCM preparations in medical institutions and lay the foundation for the later drug conversion. METHODS Research and development team used the literature research method and brainstorming method to list and organize relevant elements of project evaluation and determine the initial indicator system. Experts were consulted using the Delphi method to confirm the evaluation index. The weights were calculated based on the proportion of importance scores for each indicator and assigned specific scores to each item. The indicator system was used to evaluate 31 TCM preparations applied for filing by various departments of our hospital from April to July 2023. RESULTS After two rounds of 17 experts’ consultation， the final TCM preparation system included five primary indicators， i.e. theoretical basis， clinical research foundation， pharmaceutical foundation， prescription， and clinical value， as well as 17 secondary indicators including prescription source， traditional Chinese medicine theory， clinical positioning and so on. Human experience was considered as the item which would be rejected as one vote. Based on the above indicator system， our hospital further improved the filing and project approval process for TCM preparations in medical institutions. Among the 31 TCM preparations applied for filing by various departments from April to July 2023， 8 TCM preparations with a score ≥65 were selected for development. CONCLUSIONS The evaluation system is objective， comprehensive， and highly operable. It is suitable for the selection of TCM preparations in medical institutions before research and development.