Abstract: A algorithm of voltage sag detection based on sliding window wavelet and two points method was proposed for overcome the disadvantage of wavelet transform in the condition of harmonics interference. According to the proposed algorithm, the fundamental voltage signal can be obtained by using sliding window wavelet to filter harmonic component. Then, the amplitude ratio and phase jump information of voltage sag are detected by Two Points method. Simulation results show that the problem of voltage sag characteristic parameter calculation, which caused by wavelet coefficient maximum norm is hardly to identification, does not exist when the proposed algorithm is adopted. The proposed algorithm can meet the needs in engineering due to the voltage sag characteristic parameter can be detected under the condition of harmonics interference and the delay of detecting results less than one cycle.