In distributed connected grid system, there is serious harmonic pollution caused by wide use of inverter units and access of nonlinear loads. The traditional detection methods such as Fast Fourier Transform and wavelet analysis heavily depend on synchronous signal detection or basis functions selection, and don’t satisfy the requirements of the harmonic detection of micro grid environment. Therefore, a novel harmonic detection and analysis method under the mode of micro-sources connected in parauel is proposed combining the wavelet transform with HHT. The method uses multi resolution analysis of wavelet transform to process the original signal. Then, a series of intrinsic mode function (IMF) components are obtained from the processed signal by using empirical mode decomposition algorithm, and the fundamental component and harmonic are extracted from the IMF components. Finally, the frequency and amplitude of signal are calculated by using the Hilbert transform. Simulation results demonstrate that the proposed algorithm has high precision and good real-time characteristics. Furthermore, the algorithm can satisfy the requirements of the harmonic detection of distributed connected grid system.