The invention discloses a transformer partial discharge signal propagation characteristic testing method and a transformer fault diagnosis method. The testing method comprises: current collectors are connected to a bushing tap ground wire, a neutral ground wire and a core ground wire of the transformer in series respectively; then the negative electrode of a partial discharge calibration pulse generator is grounded, and the positive electrode of the pulse generator contacts with a winding to simulate a main insulating discharge of the winding; then the injection position of a pulse signal in the winding is changed, and standard propagation characteristics of the pulse signal are obtained according to the injection position and a corresponding collected pulse current signal; then the positive and negative electrode of the pulse generator are connected between adjacent turns and adjacent layers of the winding respectively; and standard propagation characteristics of the pulse signal are obtained according to the injection position and a corresponding collected pulse current signal. The method has great guiding significance for online monitoring of transformer partial discharge pulse current signals during actual operation.