Abstract: Addressing the characteristics of high penetration of distributed generation and flexible operation modes in AC microgrids, and considering that traditional distribution network protection struggles to meet the requirements for both reliability and stability, an improved inverse-time overcurrent protection scheme based on a negative-sequence/harmonic fusion criterion is proposed. This scheme investigates the negative-sequence current characteristics under asymmetric faults and the current harmonic distortion characteristics before and after various faults within the microgrid. By calculating the accumulation of negative-sequence current and the current harmonic distortion rate within a fixed time window, a fusion criterion incorporating both negative-sequence and harmonic distortion acceleration factors is constructed to reduce the operating time of the inverse-time overcurrent protection and optimize the coordination among multi-stage protections. PSCAD-based simulation results demonstrate the effectiveness and reliability of the proposed improved scheme under various operation modes and fault conditions of the microgrid.