The current methods of calculating the settings of grounding distance relay are summarized and analyzed. A simple and more applicable method is presented to calculate the zero sequence current compensation coefficient for the purpose of introducing the coefficient. In view of the drawbacks of the currently used setting calculation methods， a systematic method based on detecting impedance is proposed to calculate the settings of the grounding distance relay. More widely applicable and accurate， the method proposed is already applied to actual practice. The correctness and effectiveness of this method are verified by examples.