The work aims to study the flame retardant effect and flame retardant mechanism of microencapsulated red phosphorus (MRP) and nanometer magnesium hydroxide (Nano-MH) flame retardant wood-plastic composite (WPC). MRP was used as the main flame retardant. Nano-MH was used as a synergistic flame retardant. Low density polyethylene (LDPE), linear low density polyethylene (LLDPE) and wood flour were used as the basic materials to prepare flame-retardant wood-plastic materials (WPC/MRP/MH). The effects of flame retardants on the flame retardancy of composites were analyzed by determination of combustion grade, limiting oxygen index (LOI) and thermogravimetry (TG). The thermal decomposition behavior of WPC and WPC/MRP/MH was studied through the Flynne-Walle-Ozawa (FWO) method. The reaction mechanism of WPC/MRP/MH was deduced by the Criado method. It was showed when the MRP mass fraction of the composite was 12.5%, the flame retardant grade reached UL94 V-0, the LOI value was up to 28.3%; the Tonset, Tendset and Tp of WPC/MRP/MH were higher than those of WPC, and the apparent activation energy (Ea) obtained by FWO method gradually increased in the later stage of thermal decomposition, and the thermal stability of the material was significantly improved; The reaction mechanism function of WPC was g(α)=[−ln(1−α)]1/n, f(α)=n(1−α)[−ln(1−α)]1/n. The thermal decomposition mechanism was growth after nucleation. The compounding of MRP and Nano-MH effectively improves the thermal stability of WPC. The flame retardant properties of the composites are significantly improved.