Based on dispatching area and coherency grouping， the buses of a large scale power system are classified into a set of subareas. The generator buses are the core of the subareas and nongenerator buses belong to the outer layer buses. If the generators in some subareas are out-of-step， the subareas are defined as out-of-step area（OOSA） and the other part of the system is the remaining area（RA）. In the OOSA， when power balance requirements are met， only the tie lines between the outer layer buses of OOSA boundary and RA need to be searched to find the islanding cutset. There is no need to search all the branches of the system. The proposed method can significantly reduce computational cost with fast calculation speed， and therefore meets the online application requirements. Simulation results on Shandong power system demonstrate the effectiveness of the proposed method.