Disclosed are a wire-guided automatic pay-off device and method. The wire-guided automatic pay-off device is installed on a horizontal directional drilling rig and comprises a conductive ring assembly, a brush assembly, a winding device, a guide device and a guide wire. The conductive ring assembly fixed to a main shaft of a carriage assembly rotates together with the main shaft, the brush assembly fixed to a body of the carriage assembly does not rotate with the main shaft, and a conductive end of the brush assembly is in contact with the conductive ring assembly. The guide wire wound on the winding device has one end connected to the conductive ring assembly and the other end passing through the guide device, penetrating into a central hole in a drill pipe from a rear end of the drill pipe.