Unified power flow controller with fault current limiting（UPFC-FCL） is a novel flexible AC transmission system（FACTS） device which can be used to protect UPFC from being destroyed by large fault current in a power system. The detailed dynamic process and working principles of UPFC-FCL are presented. The mathematical model of UPFC-FCL in fault condition is established. Calculation and selection methods of DC reactor are illustrated based on three factors:（i） system requirement，（ii） overvoltage limit of DC capacitor and（iii） overcurrent limit of insulated gate bipolar transistor（IGBT） module. The hardware structure and control strategy of a 100 V/3 kVA UPFC-FCL prototype is introduced and the experimental results verify the correctness of the dynamic analysis and the validity of UPFC-FCL.