Children need to develop various competencies throughout early childhood for their lateracademic and social success, and Family is the initial place for children’s socialization. Thus the presentstudy would examine the relationship between democratic parenting style and preschool children’ socialcompetence, the mediating role of the home literacy environment and test the role of parental self-efficacyin the mediating path. The results indicated that after controlling for gender and grades, democraticparenting style positively predicted preschool children’ social competence. The home literacy environmentpartially mediated the relationship between democratic parenting style positively and preschool children’ssocial competence. And Parental self-efficacy significantly moderated the prediction of home literacyenvironment on preschool children’ social competence. Specifically, this prediction was more significantin families of high parental self-efficacy. This indicates that parental self-efficacy is a strengthening factorof children’s social competence development, that is, parental self-efficacy will increase the developmentof children’s social competence. In order to play the role of positive family environment in promoting thedevelopment of children’s social ability, parents should consciously improve their sense of self-efficacy,have confidence in their competence as parents, and use democratic parenting methods to create a goodhome reading environment for children. In addition, it is necessary for parents with low parental selfefficacyto receive targeted intervention training.