One of the most significant obstacles preventing the large-scale application of direct-current (DC) technology in medium voltage (MV) distribution networks is their fault protection. The existing AC relay protection needs to be changed or redesigned to protect the future overlay MVAC and MVDC distribution networks. Therefore, a comprehensive understanding of the dynamic and fault behavior and post-fault restoration strategies of MVAC and MVDC systems are critically important. Moreover, a comparison of MVAC and MVDC systems during a fault will also contribute to designing the protection systems of hybrid MV AC/DC systems. In this paper, the challenges of protecting DC faults of MVDC systems and possible solutions are first introduced. Then, the fault characteristics and post-fault restoration of MVDC and MVAC distribution systems are compared and investigated through case studies. Time-domain simulations have been conducted in PSCAD/EMTDC. The work in this paper will be valuable for the protection design for future hybrid MV AC/DC systems.