Due to the lower on-state resistance, direct current (DC) solid state circuit breakers (SSCBs) based on silicon-carbide (SiC) metal-oxide-semiconductor field-effect transistors (MOSFETs) can reduce on-state losses and the investment of the cooling system when compared to breakers based on silicon (Si) MOSFETs. However, SiC MOSFETs, with smaller die area and higher current density, lead to weaker short-circuit ability, shorter short-circuit withstand time and higher protection requirements. To improve the reliability and short-circuit capability of SiC-based DC solid state circuit breakers, the short-circuit fault mechanisms of Si MOSFETs and SiC MOSFETs are revealed. Combined with the desaturation detection (DESAT), a “soft turn-off” short-circuit protection method based on source parasitic inductor is proposed. When the DESAT protection is activated, the “soft turn-off” method can protect the MOSFET against short-circuit and overcurrent. The proposed SSCB, combined with the flexibility of the DSP, has the μs-scale ultrafast response time to overcurrent detection. Finally, the effectiveness of the proposed method is validated by the experimental platform. The method can reduce the voltage stress of the power device, and it can also suppress the short-circuit current.