The application discloses a ground grid fault diagnosis method comprising the following steps: the magnetic field data of multiple conductors of a ground grid is acquired according to the excitation current and acquisition parameters in the ground grid, wherein each piece of magnetic field data is provided with the identifier of the corresponding ground grid conductor; the acquired magnetic field data is processed; the magnetic field data after being processed is sent to a substation server through a wireless communication mode; and the substation server diagnoses that a first conductor of the ground grid fails when confirming that the magnetic field data of the first conductor of the ground grid after being processing is less than a first preset threshold according to the identifier of the ground grid conductor. The method and the system can locate a fault of a ground grid precisely, have high detection efficiency, and can realize online real-time detection.