Abstract: Microgrids are the future of growing consumer power demand. The addition of renewable energy Resources to microgrid makes the power flow to be bidirectional. Reconfiguration of the microgrids occurs due to RES, load and utility grid connection and disconnection. Thus, conventional protection strategies are inapplicable to microgrids and are a challenge for the protection engineers to clear the fault. This study proposes Fredman-Tarjan's algorithm for identifying the current topology of the microgrid. The Dijikstra and Floyd-Warshall path recovery algorithm are also used to identify the shortest path from a fault to the nearest operating source. The algorithm ensures that during the process of fault clearance, minimum part of the network is disconnected from the healthy portion of network. The proposed algorithm is tested and validated on a 16-bus microgrid network and an IEEE 69-bus distribution network.