The paper presents a novel idea to detect transient single-phase-to-ground fault based on current travelling waves in power distribution system with neutral non-effectively grounded, and an implemented scheme of protective relays based on current travelling waves and power-frequency voltages, which can identify not only permanent single-phase-to-ground faulted feeder but transient faulted feeder, which helps to prevent the transient insulation flashover from evolving to the permanent fault and phase-to-phase fault. The paper uses the amplitude and polarity characteristics of zero-sequence current travelling waves measured in all feeders to identify disturbance source and determines whether the disturbance is transient single-phase-to-ground fault based on the same disturbance source frequency. And the paper uses zero-sequence and three-phase voltages to detect permanent single-phase-to-ground fault and current travelling waves to identify the faulted device. When transient or permanent single-phase-to-ground fault is determined with the faulted source, a smart processing scheme is presented, which closes the tie switch at first and opens the faulted feeder at last, to meet the requirements of smart grid providing uninterruptible power supply to the load.