Abstract No selective protection exists in the low-voltage level micro-grid integrated with DG presently. To deal with this problem, a new type of micro-grid protection scheme based on fault component is put forward. To implement this scheme, the micro-grid is divided into several regions, and each region is regarded as the target of protection. As a result, not only the scope of outage is decreased in accordance with the action of the protection, but the economic requirement of protection arrangement is met. Taking the negative sequence component as the basic characteristic quantity, a variety of asymmetric faults effectively can be identified successfully. Considering the adverse effects of unbalanced load and the switching of large capacity single phase load, a low-voltage supplement criterion is introduced. The effectiveness of this protection scheme is verified with EMTDC based simulation tests.