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As renewable energy is widely used, distributed power generation systems are also used in wide range. However, some problems in renewable power systems have to be addressed. Among these problems, the islanding operation has the most important impact to the safety of utility workers and the service lives of equipment. This paper studies islanding detection for a microgrid system with unbalanced loads and its implementation on a real-time simulator (RT-Lab) to accelerate simulations. The presented islanding detection approach utilizes rate of change of frequency (ROCOF), under/over frequency, and negative sequence current injection methods. Decoupled double synchronous reference frame software phase lock loop (DDSRF-SPLL) is used to synchronize the grid-connected power converter with the utility voltages under unbalanced load conditions. Two cases are tested in real time. The presented approach detects the islanding in 0.09 seconds after the fault occurs, and the voltage at the point of common coupling (PCC) returns stable in 0.1 seconds after the fault occurs, satisfying the IEEE Standard 1547-2003.