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With the development of digitization of substation, the future trend of on-line monitoring system of substation power equipment is adopting the IEC61850 standard to realize seamless communication. However, the change of distance and node make synchronization precission of samples transmission become a problem. An implementation method based on the IEEE1588 standard is proposed, by use of DP83640 Ethernet PHYTER which includes all of the hardware to implement the IEEE1588 Precision Time Protocol. The design not only implements the precise time synchronization between the master clock and slave clocks of the distributed on-line monitoring system based on Ethernet, but also shortens the design cycle.