Microgrid with local DGs suffers from unintentional islanding and protection issues. Improper detection of islanding leads to equipment damage, maloperation of circuit breakers, equipment damage, and serious injuries to operating personnel. Therefore, islanding events should be detected and DGs should be isolated from the utility within time. In this work, a new passive islanding scheme based on the Teager-Kaiser energy operator (ψ) is proposed. Three-phase current and voltage samples are collected at PCC and used to calculate the ψ ( v ) / ψ ( i ) . This ψ ( v ) / ψ ( i ) is used to calculate the index (N). If the index (N) is less than the threshold, the proposed IDT detects it as an islanding event (IE) event otherwise it detects as an NIE. The proposed IDT has the ability to discriminate between the non-islanding event (NIE) and islanding event (IE) during zero RPM and, zero APM different types of load switching, and the inception of different faults at different locations. The IEEE 13 bus system has been taken as a test system to test the efficacy of the proposed IDT and the test system was designed and executed in MATLAB/Simulink.