According to distributed power system fault characteristic, a new criteria based on the transient high frequency instantaneous zero-sequence power is put forward to distinguish the fault line in this paper with multi-resolution analysis of wavelet and the difficulty of frequency zone selection in wavelet application is overcome. The sign of the maxim high frequency instantaneous power is the first criteria and the value of the power is the second criteria in the new criteria. The simulation suggests that the new criteria could distinguish correctly the fault line under various grounding impedance and fault distance, whose performance is independent on the grounding model of centric dot and fault occurring time, and the new criteria has a excellent adaptability to various fault conditions.