Monitoring fault current is very important in power system protection. Therefore, the impact of installing Distributed Generation (DG) on the fault current is investigated in this paper. Three types of fault currents which are single line-to-ground, double line-to-ground and three phase fault are analyzed at various fault locations. The optimal location of DG was identified heuristically using power system simulation program for planning, design and analysis of distribution system (PSS/Adept). The simulation was conducted by observing the power losses of the test system by installing DG at each load buses. Bus with minimum power loss was chosen as the optimal location of DG. In order to study the impact of DG to the fault current, various locations and sizes of DG were also selected. The simulations were conducted on IEEE 33-bus distribution test system and IEEE 69-bus distribution test system. The results showed that the impact of DG to the fault current is significant especially when fault occurs at busses near to DG location. © 2017 Institute of Advanced Engineering and Science. All rights reserved.