The invention relates to a distributed small-current grounding fault location method and a system for a distribution automation system. Based on a fault section and the upstream and downstream of a fault point, the transient zero sequence current correlation coefficient, the transient zero sequence current amplitude coefficient and the ratio of transient zero sequence current peak to power-frequency zero sequence amplitude on both sides of the section are optimized. A fault location algorithm meeting distributed fault processing requirements is obtained through comprehensive utilization of the fault zero sequence current features. The distributed small-current grounding fault location method for a distribution automation system presented by the invention can improve the applicability of a small-current grounding fault transient location technology, and can be used to solve the product coordination problem of different manufacturers.