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The paper presents wavelet singular entropy (WSE)-based islanding detection in distributed generation (DG) interfaced to the microgrid. Initially, the three-phase voltage signals retrieved at the target DG location are processed through wavelet transform (WT) to derive detailed coefficient at different levels of decomposition. From the detailed coefficients, the singular value matrix is generated and the WSE for each phase is calculated. Finally, the WSE index (WSEI) for islanding detection is computed by adding the WSE of each phase. The proposed WSEI is able to detect islanding within 10 ms (half cycle) from the event inception, showing the speed of the developed technique. It is observed that WSEI is highly effective in islanding detection, including different islanding and nonislanding conditions in the initial test system and standard microgrid with wide variations in operating parameters.