This paper deals with the fault diagnosis methodology for the V/x-type traction transformer in railway passenger-dedicated lines. A kind of the protection methodology to combine empirical mode decomposition (EMD), energy weight, and information entropy is proposed. This method can sensitively reflect the dynamic information changes of traction transformer differential current, so it can not only effectively identify internal short-circuit fault current from magnetizing inrush but also better identify fault current accompanied with magnetizing inrush. In this method, the differential current is decomposed by EMD and the energy weight of each intrinsic mode function (IMF) is calculated, and the feature vector of the fault pattern recognition is obtained by constructing IMF energy entropy. The field-measured data illustrate that the new method not only has the advantages of high sensitivity, faster identification speed, and clear concept but also is available for the diagnosis of the complicated dynamic system.