This paper proposes a method for the diagnosis of stator inter-turn short-circuit fault for permanent magnet synchronous generators (PMSG). Inter-turn short-circuit currents are among the most critical in PMSG. For safety considerations, a fast detection is required when a fault occurs. This approach uses the parameter estimation of the per-phase stator resistance in closed-loop control of variable speed of wind energy conversion system (WECS). In the presence of an incipient short-circuit fault, the estimation of the resistance of the stator in the d-q reference frame does not make it possible to give the exact information. To solve this problem, a novel fault diagnosis scheme is proposed using parameter estimation of the per-phase stator resistance. The per-phase stator resistance of PMSG is estimated using the MRAS algorithm technique in real time. Based on a faulty PMSG model expressed in Park’s reference frame, the number of short-circuited turns is estimated using MRAS. Fault diagnosis is on line detected by analysing the estimated stator resistance of each phase according to the fault condition. The proposed fault diagnosis scheme is implemented without any extra devices. Moreover, the information on the estimated parameters can be used to improve the control performance. The simulation results demonstrate that the proposed method can estimate the faulty phase.