Dispersed Generation (DG) units significantly effect the existing distribution protection practices. Therefore, new protection practices of the distribution system interconnected with DG units should be reevaluated and developed. In this paper, a new inter-tie protection scheme of DG units for distribution automatic reclosing is proposed. The impact of DG units on existing radial-sectionaliser coordination is analyzed. And the effects of the distribution reclosing type (radial and passive reclosing) on DG dynamics are analyzed and classified. From the results of the DG dynamic responses by the reclosing type, i.e. radial and passive reclosing, the inter-tie protection schemes of DG are introduced to improve the reliability and availability of utility interactive DG. The proposed schemes are proved and evaluated by a case study using PSCAD/EMTDC simulation.