A novel pilot protection method based on parameter identification for cable lines with shunt reactor in the middle is proposed. The fault component network is used for fault analysis. The installation site of the shunt reactor is selected as the set point. Then, based on the distributed Bergeron model of the cables, the voltage and current at the set point can be calculated using the voltages and currents at two ends of the cable. The ratio of the voltage and the current is defined as the characteristic impedance of the corresponding terminal. The equivalent parallel impedance for characteristic impedances of both terminals is defined as the characteristic parameter, which can be obtained using the proposed parameter identification method. When an external fault occurs, the identification result is the impedance of the shunt reactor, whose polarity is positive. When an internal fault occurs, the identification result is the parallel impedance of the systems behind at both terminals, whose polarity is negative. Therefore, the protection criterion can be constructed based on the polarity of the identified parameters. Theoretical analysis and simulation results prove that the proposed protection method is robust to fault impedance and does not require a high sampling rate. The proposed principle has high sensitivity and reliability. This work is supported by the Key Project of Joint Fund of the National Natural Science Foundation of China (No. U1766209).