The primary problem brought by high speed is high-frequency loss. The loop current (LC) of inter-turn short-circuit fault causes serious distortion of the magnetic field in high speed permanent magnet generator (HSPMG), whose effects on the loss cannot be ignored. In order to reveal the influence mechanism of ITSC fault on the loss, the two-dimensional finite element model of the 117 kW, 60,000 rpm HSPMG is established. By comparing calculation results and test data, the accuracy of the model is verified. The distribution of the eddy current density is studied, and the fundamental reason for the sharp increase of eddy-current loss after fault is found. The core losses at different positions were obtained by segmenting stator core, and the variation mechanisms of core losses at different positions are revealed. The change of heat source distribution of stator core after fault is determined. The variation of winding copper loss after fault is analysed, and the influence degree of the LC on the fault phase and healthy phase copper loss is determined. In addition, because the temperature field is directly related to the loss, the research also laid a foundation for the next analysis of the temperature field.