Abstract: The inverter-dominated ac grid requires high reliability. When short-circuit faults occur on the load side, it is required to remove the faulty branch quickly and restore power supply to other normal load branches to achieve selective protection. The inverter-dominated power grid has the characteristics that the short-circuit current does not change with the position of the short-circuit point and can be controlled by the inverter since the inverter is working in the current-limiting mode. Most of the existing inverter-based power grid selective protection strategies need to use microprocessor-based digital relays. Focusing on the short-circuit protection issue of 380 V-level inverter-based power grid, this paper proposes a protection strategy based on 'echelon current limiting idea', which can achieve selective protection by cooperating with the conventional protection components of power distribution system such as breakers and fuses. The control algorithm is simple and easy to implement, and there is no need to use microprocessor-based digital relays which are more complicated and expensive. In addition, the detailed protection setting process and design examples are given, which can be used to guide the protection design of the system. The experimental results show that the current limiting strategy and protection setting method proposed in this paper can quickly remove the fault branch, so as to achieve selective protection and avoid expanding the blackout area, and then the effectiveness of the proposed strategy has been verified.