The invention relates to a system and method for detecting a fault of a DC grounding electrode line, and the system and method achieve the fault discrimination and range finding of the DC grounding electrode line. The system comprises a high-voltage reactor, a high-voltage capacitor, an impedance matching module, an overvoltage protection module, a fault detection device, and a connection cable. The fault detection device can transmit a common mode pulse signal and a differential mode pulse signal, and the common mode pulse signal and the differential mode pulse signal are injected into two conductors of the DC grounding electrode line through the impedance matching module and the high-voltage capacitor. Moreover, a fault reflection traveling wave is detected through the above loop. The high-voltage reactor is disposed at a split part of the grounding electrode line so as to prevent a DC field from affecting a common mode signal traveling wave. The system can reduce the mutual counteracting of differential mode signal traveling waves, and also can enable a differential mode traveling wave method not to be limited by an installation site. The method can improve the amplitude and signal to noise ratio of the traveling wave signals, and can improve the reliability and range finding precision of fault detection of the DC grounding electrode line.