Dynamic phasor is suitable for analysis of non-stationary signals (such as power swings) in phasor measurement unit. In this study, dynamic phasor of the generated signals during power swing is analysed by a classical signal processing technique known as Prony. The Prony analysis is a useful technique to model a linear sum of damped complex exponential signals. In this study, a combination of the least square-based Prony analysis and Taylor expansion called as Taylor-Prony is proposed to estimate the dynamic phasor. Zeroth-order Taylor-Prony, i.e. static phasor is compared with the second-order Taylor-Prony, i.e. dynamic phasor for illustrating the dynamic phasor capability. Sinusoidal and step changes of amplitude and phase, harmonic condition, frequency tracking tests, noise infiltration and computation time are different tests which are used to validate the proposed method. First, the method is explained theoretically, and then its potential is demonstrated by simulating various numerical signals in MATLAB and measured signals during power swing from three-machine power system simulated in PSCAD. Simulation results show that the proposed method can estimate the dynamic phasor during power swing accurately. Ultimately, the proposed method is compared with six methods which have already presented to verify the capability of the proposed method.