This paper proposes a new hybrid islanding detection method for grid-connected photovoltaic system (GCPVS)-based microgrid. In the presented technique, the suspicious islanding event is initially recognized whilst the absolute deviation of the point of common coupling (PCC) voltage surpasses a threshold. After an intentional delay, a transient disturbance is injected into the voltage source inverter’s d-axis reference current to decline the active power output. As a result, the PCC voltage reduces in islanding operating mode whilst its variation is negligible in the grid presence. Therefore, the simultaneous drop of PCC voltage and active power output is used as an islanding detection criterion. The effectiveness of the proposed algorithm is investigated for various islanding and non-islanding scenarios for a practical distribution network with three GCPVSs. The simulation results in MATLAB/Simulink show successful islanding detection with a small non-detection zone within 300 ms without false tripping during non-islanding incidents. In addition to the precise and fast islanding classification, the presented scheme is realized inexpensively; its thresholds are determined self-standing, and its output power quality degradation is eminently small. Moreover, the active power output is restored to the nominal set after islanding recognition, enhancing the chance of GCPVS generation at its highest possible level in the autonomous microgrid.