This paper developed improved fast Walsh transform based on dyadic-ordered fast Walsh transform, then regenerated signal flow graph of improved fast Walsh transform, and used it for digital filtering, and then measured fundamental frequency and harmonics for current and voltage signals of power system. Using the improved fast Walsh transform, we present a new algorithm which reduces the computational amount, and it can consequently calculate the real and imaginary components for current and voltage signals of power system in sampling intervals. The calculation amount is reduced to 2(N-1) at N samples to measure full harmonics using developed algorithm. When, in single harmonic measuring, it needs only 2(log2N-1) additions and subtractions.