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Small-scale synchronous generators (SSSGs) are widely utilized as distributed generators in power systems. A large fault current due to the SSSG phase-to-ground short circuit may result in excessive damages to the stator core and windings, in a way that major repairs, such as core disassembling and rewindings, become necessary. Thus, the fault current should be properly restricted to prevent such damages and reduce the required capital and time for SSSG repairs. In this research work, a model to calculate the SSSG internal fault current is developed. Meanwhile, an appropriate index to quantify the damages to the faulty SSSG is presented. Afterward, influencing parameters on reduction of the damages are investigated when either frequently used TT or TN grounding systems are applied for SSSGs. Studies show that the stator damages are mainly caused by the SSSG fault current rather than that of the system. Accordingly, to reduce the SSSG vulnerability to the stator earth fault, not only some applicable strategies are proposed for the both grounding systems, but also the favorable grounding system is determined. [ABSTRACT FROM AUTHOR]