This study presents a wavelet-alienation based algorithm for protection of two terminal transmission line. The proposed algorithm makes use of wavelet transform based approximate coefficients of three-phase voltage and current signals, obtained over a quarter cycle to detect, classify and locate various faults. Detection and classification of these faults are achieved with the help of alienation coefficients of current signals from both the terminals of the transmission line. The approximate coefficients of voltage and current signals, obtained over a quarter cycle, are fed to artificial neural network to locate the faults precisely. The proposed algorithm has been tested successfully for various types of faults with the variations in location, inception angle and fault impedance. © The Institution of Engineering and Technology 2016.