The access of large-scale distributed generators bring challenges to the operation reliability of the distribution networks. The traditional fault diagnosis methods are difficult to meet the requirements of the safe operation of the distribution networks. In order to improve the comprehensive reliability, this paper analyzes the problem that the fault current of distribution networks with inverter interface distributed generation (IIDG) changes greatly due to the fast response of controller. The traditional fault analysis method is extended, so that the root mean square (RMS) of fault current from IIDG and grid detection current can be calculated accurately in fault analysis. Through the simulation of IEEE standard distribution networks, the accuracy of the method is proved under different fault conditions. The research results provide a reference for improving the stability and reliability of distribution network operation, and comprehensively improving the automation level of distribution network.