Abstract-Interturn short circuit faults are the leading cause of power transformer's failure. If not detected at incipient stage, these faults usually develop into more severe faults that would result in irreversible damage to the transformer, unexpected outages and the consequential losses. This paper presents transformer interturn fault detection system (TIFDS) for the detection of interturn fault at inception stage in power transformer. TIFDS is immune to supply voltage imbalance, constructional asymmetries and instrumental errors. It also takes care of unequal load distribution. TIFDS algorithm makes the transformer symmetrical in its entire three phases and sets primary side neutral current to zero value. This is achieved by computing and applying various correction coefficients. However, under interturn fault condition, TIFDS characterizes the behavior of neutral current. Simulation and experimentation studies are carried out on 400/110V, 3x2.5 kVA power transformer. Presented test results demonstrate the effectiveness of the proposed system.Index Terms--Interturn fault, Neutral current, Transformer, Transformer interturn fault detection system (TIFDS).