Disclosed is an improved projection integral algorithm based active power distribution system dynamic simulation method. The method includes inputting active power distribution system example power flow data, dynamic element data and fault and operation set information, setting simulation parameters, forming a total system node admittance matrix according to the system example parameters and the dynamic data, simulating initialization calculation, setting simulation time t=0 and an integral step number s=1, perform calculation in time periods of t<n> to t<n+1>, judging whether a system breaks down or is operated, judging whether the simulation time t is larger than the set time T, judging whether an integral step number s in an improved projection integral algorithm is larger than the set step number k+1, judging whether fault or operation exists in the Mh time, setting simulation time t=t+Mh, executing an external integrator correction step in the improved projection integral algorithm, and judging whether the simulation time t reaches the set simulation time T. The improved projection integral algorithm based active power distribution system dynamic simulation method is high in numerical precision, good in numerical stability, high in computational efficiency, and applicable to active power distribution system dynamic simulation with rigid features.