This study was carried out to explore the diagnostic effect of magnetic resonance imaging (MRI) based on the low-rank matrix (LRM) denoising algorithm under gradient sparse prior for the tibial plateau fracture (TPF) combined with meniscus injury (TPF + MI). In this study, the prior information of the noise-free MRI image block was combined with the self-phase prior, the gradient prior of MRI was introduced to eliminate the ringing effect, and a new MRI image denoising algorithm was constructed, which was compared with the anisotropic diffusion fusion (ADF) algorithm. After that, the LRM denoising algorithm based on gradient sparse prior was applied to the diagnosis of 112 patients with TPF + MI admitted to hospital, and the results were compared with those of the undenoised MRI image. Then, the incidence of patients with all kinds of different meniscus injury parting was observed. A total of 66 cases (58.93%) of meniscus tears (MT) were found, including 56 cases (50.00%) of lateral meniscus (LM), 10 cases (8.93%) of medial meniscus (MM), 16 cases (14.29%) of meniscus contusion (MC), and 18 cases (16.07%) of meniscus degenerative injury (MDI). The incidences of MI in Schatzker subtypes were 0%, 53.33% (24/45), 41.67% (5/12), 76.47% (13/17), 78.94% (15/19), and 23.53% (4/17), showing no statistically significant difference (
P
>
0.05
), but the incidence of MT was 54.46% (61/112), which was greatly higher than that of MC (15.18% (17/112)), and the difference was statistically obvious (
P
<
0.05
). The diagnostic specificity (93.83%) and accuracy (95.33%) of denoised MRI images were dramatically higher than those of undenoised MRI images, which were 78.34% and 71.23%, respectively, showing statistically observable differences (
P
<
0.05
). In short, the algorithm in this study showed better denoising performance with the most retained image information. In addition, denoising MRI images based on the algorithm constructed in this study can improve the diagnostic accuracy of MI.