To maintain transparency and improve flame retardancy and mechanical properties of epoxy resin, a reactive organophosphorus flame retardant (DPDDM) was designed and synthesized, which was derived from 3,4‐dihydroxybenzaldehyde, 4, 4′‐ diamino diphenylmethane and 9,10‐dihydro‐9‐oxa –10‐ phosphaphenanthrene‐10‐oxidein two steps. Compared with neat epoxy resin (EP), the tensile strength and flexural strength of the EP with 5% DPDDM increased by 28.6% and 42.8%, respectively, indicating that DPDDM can significantly improve the mechanical properties of EP materials. Meanwhile, the DPDDM modified EP materials have good transparency and the EP with 5% DPDDM passed the V‐0 rating and had the limiting oxygen index as high as 34%. Cone calorimeter test results showed that the heat release and smoke generation of the modified materials were significantly lower than the unmodified materials, which were reduced by 32.6% and 64.6%, respectively, indicating that the modified materials can greatly improve the safety of fire prevention. This work provides a new approach to prepare transparent epoxy resin with good mechanical properties and excellent flame retardancy.