Most of the power line faults are caused by insulation problems. In view of problems that the main treatment of insulation faults by electric power department are passive maintenance after faults, a power line insulation faults early warning system is developed based on traveling wave technology to eliminate the insulation fault in early stage. Firstly, the degradation process and flashover mechanism are analyzed. Secondly, a power line insulation faults early warning system is developed based on the principle of insulation fault early warning. Finally, the field test of the system is conducted. It shows that the insulator partial discharge can be early warned, the locating accuracy is high with the average error of 16.6 meters, which meets the requirements of field operation.