Pulse current method is applied to locate the fault of sub-way cables in practice, due to the complexity of the sub-way failures and the attenuation of transmit waves, a certain error exists. This paper introduces a method that combines the measurement with pulse current method and multiple-layer wavelet analysis, and the measurement accuracy is then approved. Daubechies (db2) wavelet analysis method is implemented with five-layer decomposition of raw waveforms, which could well eliminate the cable clutters, improve the signal recognition rate, reduce the measuring errors, and finally effectively improve the accuracy of online fault distance measurement.