Reliable operation of multichannel power electronic converters in a large pumped storage power plant (PSPP) is a main concern among policymakers and/or hydropower project developers. This paper aims to design a two-stage protection circuit operation strategy for a large-rated doubly fed induction machine (DFIM) employed for variable-speed PSPPs. This paper initially studies the dynamic behavior of DFIM under symmetrical short-circuit faults in both the 400-kV power system and at stator terminal of the generating unit. Based on the fault analysis, a two-stage protection circuit (dc-link braking chopper circuit and crowbar protection circuit) operation strategy is designed in consideration of practical limitations. The designed operation strategy ensures the continuous operation of large-rated DFIM under marginal grid disturbances. To investigate the effective operation of a two-stage protection circuit, a 250-MW DFIM with multichannel power converters is implemented in MATLAB/Simulink tool. An experimental test is carried in a 2.2-kW DFIM laboratory prototype.