The invention proposes a solid-state transformer with an alternating current-direct current fault continuous operation capability and a control method. A hybrid modular multi-level converter bridge arm consists of a half-bridge sub-module and a full-bridge sub-module; the half-bridge sub-module and the full-bridge sub-module are interconnected with input ends of isolated dual active bridge converters through a sub-module direct current capacitor; output ends of multiple isolated dual active bridge converters are connected in parallel to form a low-voltage direct current bus; and the low-voltage direct current bus is connected to a three-phase full-bridge inverter. The solid-state transformer provided by the invention can provide a medium-voltage direct current port, a medium-voltage alternating current port, a low-voltage direct current port and a low-voltage alternating current port, so that multi-voltage-grade and multi-form alternating current-direct current hybrid power distribution network interconnection can be realized; the solid-state transformer has the alternating current-direct current fault continuous operation capability, quick switching of device operation modes whena short circuit or open circuit fault occurs on a network connected to any port can be realized, and continuous operation between non-faulty ports can be ensured, thereby improving the power supply reliability of the alternating current-direct current hybrid distribution network.