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Islanding refers to a condition of a distributed generator (DG) in that it continues to power a location even though power from the grid is no longer present. This condition can be dangerous to grid workers who may not realize that the load is still powered even though there is no power from the grid. Adverse effects of islanding are low power quality, grid-protection interference, equipment damage, and personnel safety hazards. For these reasons, DG systems must detect an islanding condition and immediately stop producing power; this is referred to as anti-islanding. Islanding detection methods can be categorized into two major approaches: the passive and active methods. The passive methods are based on measurement of the natural effects of islanding. The active methods use intentional transients or harmonic effects. When the power generated by the DG matches the load power consumption, passive methods fail due to the small natural effects of islanding. Therefore, the passive methods have a nondetection zone (NDZ). The active methods can reduce the NDZ size. However, these methods reduce the grid power quality. In this paper, a novel anti-islanding method (AIM) is proposed. A single-phase DG using the proposed AIM injects the output current with a little harmonic current into the grid and monitors the harmonic components of the voltage at the point of common coupling using the Goertzel algorithm. The Goertzel algorithm is a kind of discrete Fourier transform. It extracts the magnitude and phase of the desired frequency from the input signal, with a minimum computation. The proposed islanding detection algorithm resolves the NDZ but also the bad effects on the grid power quality due to injecting harmonic components qualified by the interconnection standard. The proposed islanding detection method was verified using PSIM (see www.powersimtech.com) simulations and experimental results.