When droop-controlled Distributed Generation (DG) is connected to an islanding microgrid, it can present voltage source characteristics under a fault condition and maintain voltage stability of buses. According to the characteristics of DGs’ weak contribution to short-circuit current in the low-voltage microgrid, the relationship between DG output power and bus voltage under non-fault and symmetrical fault conditions is analyzed. An improved droop control strategy is presented and the reference values of active and reactive power output are set according to the output impedance. Therefore, the influence of voltage sag and frequency fluctuation on the output power of DGs is avoided. Considering the current limiting output, DGs can output maximum power and improve the bus voltage when a fault occurs in the microgrid. The simulation results show the effectiveness of the proposed method. This work is supported by Fundamental Research Funds for the Central Universities (No. 22120200230).