As an effective way to solve various problems in modern power systems， microgrid is increasingly adopted in many developed countries. Via detailing the concept and schemes of microgrid worldwide， the paper aims to clarify the differences and similarities between microgrid and distributed generation（DG）， and give some advices on its application in China. Firstly， the transition from DG to microgrid is presented and a typical topological structure of microgrid is employed to demonstrate its unique characteristics. Secondly， researches and developments on microgrid in various countries are summarized. The key topics and ongoing research and development programs are also listed and analyzed. Finally， based on the energy strategies and status of power systems in China， the developing potentials and the possible applications of microgrid in China are discussed.