With detailed comparative analysis of traditional fault line selection algorithms， this paper analyzes characteristics of transient zero sequence current and presents a fault line selection algorithm. This new algorithm extracts the effective band fault zero sequence current information through the frequency-dividing characteristics and single reconstruction ofà trous algorithm. Fault measures function is also presented to reflect the effectiveness of the proposed fault line selection algorithm. Through theoretical analysis and ATP simulations， the proposed method is validated to be effective and reliable for various small current grounding systems with different neutral grounding modes.