A FTU optimal placement algorithm in the active distribution network is proposed when the distributed generations are accessed to the active distribution network in order to improve the monitoring and management of the active distribution network. Firstly, according to the characteristics of the active distribution network, the principles of the active distribution network’s observability are analyzed from the view of state estimation. The load power is used as the pseudo-measurement and the observability of the active distribution network can be improved by the FTU optimal placement so that the active distribution network can be completely observable. The active distribution network’s power loss influence of the FTUs’ distribution is considered during the optimal placement. A mathematical model of the FTU optimal placement in the active distribution network is established and the genetic algorithm is used to solve the 0-1 integer programming model. At last, the simulation shows that the optimal placement can guarantee the observability and power supply reliability of the network in the 33-bus and 60-bus active distribution network, and the placement is also adapted to the changes of network structure. This work is supported by National Natural Science Foundation of China (No. 51677025).