The invention relates to a fault indicator and distributed intelligent terminal matched overhead distribution network fault positioning method, and belongs to the technical field of relay protection of power systems. On the premise that overcurrent relay protection of a traditional distribution network is not changed, distributed intelligent terminals are installed on circuit breakers at all trunk section points and fault indicators are installed on all branch circuits, the installation positions of the distributed intelligent terminals are taken as nodes, a relation between the fault indicators and the nodes is defined according to the positions of the nodes and the fault indicators, and trunk units and branch units are divided and numbered to form a unit adjacency list. When faults occur, an automatic reclosing lock recloses transient faults, the distributed intelligent terminals isolate permanent faults, and meanwhile, the distributed intelligent terminals and the fault indicators detect current values and compare maximum branch current values in the relevant unit adjacency list to position trunk faults and branch faults.