With the continuously increasing scale of the power system, the short-circuit current of buses is consequently increasing. At present, the current-limiting inductor (series inductor) is often used to limit the three-phase fault current in 500 kV power system. The paper presents a new approach for optimal CLI location based on particle swarm optimization(PSO), to make the quantity and total impedance of CLI least and ensure power system normal operation in the premise of meeting short-circuit current limit. The practicability and reliability of the approach is verified by comparison with enumeration results of an IEEE 30-bus system. The approach has been applied to the Jiangsu Power Grid and met the design requirements.