The safe and stable operation of the power grid system is conducive to ensuring the orderly development of China’s economy. Therefore, we must firmly grasp the development trend of the power distribution automation power system, comprehensively grasp and understand its existing problems, and formulate targeted solutions. This paper mainly studies the application of IEC61850 in intelligent distributed network automation. The communication application IEC 61850 of the master station and the terminal in the distribution network automation is the current development direction. The use of object-oriented modeling technology and a unified configuration language can improve interoperability between devices, reduce communication configuration, and reduce the workload of installation and commissioning. The communication service mapping defined by IEC 61850 is completely suitable for distribution network automation communication. Adopt distribution Intelligent control technology and design based on the IEC61850 standard are the development trends of intelligent power distribution terminals. This paper gives the structure of a distributed intelligent distribution automation system. The control mode studied in this paper has an impact on the system’s annual outage time indicators, and the indicator SAIDI is correspondingly increased, and the corresponding proportions are 52.1% and 43.2%. ENS and ASAI are proportional to the optimization level of this indicator, so it can be shown that the construction of distribution network automation can effectively reduce the power outage duration of the entire system, which has a significant effect on improving the reliability of distribution network power supply.