Aiming at the problem of high brittleness of cement stone, we have studied the self‐emulsificating and self‐crosslinking modification of epoxy resin (EP) (E54), and the modified EP was used in oil well cement to improve the cement ring toughness and reduce the cement ring cracked. Using 2‐acrylamide‐2‐methyl propane sulfonic acid and acrylamide as modified monomers, benzoyl peroxide as initiator, and grafting modification method by free radical polymerization to obtain water‐borne epoxy resin (WBE). Fourier transform infrared spectrometer and 1H NMR were used to characterize the modified product, which showed that the WBE contained ─SO3H and ─CONH2 hydrophilic groups, and the connecting method of the hydrophilic side chain was clarified. WBE can achieve good dispersion in an aqueous solution, it can be stabilized for 30 min without stratified at a centrifugal speed of 6000 rpm; when the temperature is >80°C, it can be self‐curing. The addition of WBE can increase the flexural strength of cement stone by 48.3%, the compressive strength by 38.4%, and reduce the modulus of elasticity by 45.3%. Scanning electron microscope analyzed the mechanism of WBE to improve the toughness of cement stone, and found that after WBE cross‐linking, polymer films and three‐dimensional network structures are formed in the cement stone, making the cement structure more compact. WBE can effectively improve the mechanical properties of cement rings and can be used to improve cementing quality.