An online setting method based on fitting with rotational power signal is proposed to provide a reference setting value of improved rotational speed power system stabilizer (PSS2A) in field tests, which reduces the repeated tests’ impact on the generator and the power system, enables the excitation controller has robustness in the situation of low-frequency oscillation. The TLS-ESPRIT algorithm is used in the method to fit the accelerating power signal of PSS2A and get the phase frequency characteristics of the system. The residue method is required to calculate the angle to be compensated of lead link in PSS2A. The measured data of a hydropower plant in CSG is simulated by using this method, and the simulation result is compared with the setting value calculated by spectrum analyzer in the field. Numerical simulation and test analysis prove that the setting value obtained by this method has a better reference value, which brings a convenience to the field debugging.