The invention discloses a method for identifying and preventing differential protection action of a transformer caused by inrush current. In the state of fault current, when the criterion is not satisfied, the differential protection is correctly blocked, and when the criterion is met, the protection is correctly opened; 2) Use the fundamental wave amplitude increment method to judge whether it is the inrush current, if the current is judged to be In response to inrush current, short-term enhancement of braking characteristics is adopted, and the next step is to judge TA saturation. If it is judged as exciting inrush current, the criterion of exciting inrush current is used to judge whether to act; 3) Use virtual braking criterion to judge TA saturation, if If the TA is saturated, the 2-level short-time enhanced braking characteristic is adopted, and if it is not saturated, the short-time enhanced braking characteristic is adopted; 4) The differential protection operates when the protection current falls in the action area, otherwise the differential protection does not operate. The invention can fundamentally solve the problem that the surge current will cause the differential protection to malfunction.