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A fault detection and location algorithm on three-terminal transmission line is proposed. Vast literature on fault location shows that to simplify the analysis, line charging currents are often ignored. To improve the accuracy of fault location, synchronized current and voltage measurements from three ends of the three-terminal line are utilized to detect and locate distance to fault while considering the line charging currents. The method first detects the zone at which the fault has occurred and then locates it from the respective line ends. Since three-terminal lines provide solutions for connecting existing system to the grid, facilitating bulk transfer of power, thus the fault detection and location on the same is important to maintain reliability and security of the system. Performance of the proposed algorithm is tested for various fault types, fault locations, fault resistances and fault inception angles. The 200-kV system is simulated in ATP/EMTP; however, the algorithm is developed in MATLAB. The extensive simulation studies demonstrate accuracy of the proposed scheme.