As the power grid becomes more magnified and complicated, wide-area protection system in the practical engineering application is more and more restricted by the communication level. Based on the concept of limitedness of wide-area protection system, the grid with complex structure is divided orderly in this paper, and fault identification and protection action are executed in each divided zone to reduce the pressure of the communication system. In protection zone, a new wide-area protection algorithm based on positive sequence fault components directional comparison principle is proposed. The special associated intelligent electronic devices (IEDs) zones which contain buses and transmission lines are created according to the installation location of the IEDs. When a fault occurs, with the help of the fault information collecting and sharing from associated zones with the fault discrimination principle defined in this paper, the IEDs can identify the fault location and remove the fault according to the predetermined action strategy. The algorithm will not be impacted by the load changes and transition resistance and also has good adaptability in open phase running power system. It can be used as a main protection, and it also can be taken into account for the back-up protection function. The results of cases study show that, the division method of the wide-area protection system and the proposed algorithm are effective.