In　order　to　implement　a　functional　control　scheme　for　a　system,　the　current　state　of　the　system　must　be　known.　Otherwise,　even　the　most　complicated　control　system　will　be　handicapped.　State　Estimate　is　a　well-known　function　in　transmission　network　analysis.　In　this　paper,　based　on　the　placement　of　phasor　measurement　units　(PMUs),　a　new　algorithm　for　distributed　power　system　state　estimation　is　presented.　In　the　first　part　of　this　algorithm,　with　the　placement　of　PMUs　based　on　the　improved　method　of　bordered　block　diagonal　form　(BBDF),　the　large　system　can　be　divided　into　many　small　systems.　In　the　second　part,　Using　the　data　of　PMUs　between　subsystems　as　boundary　condition,　the　problem　of　distributed　power　system　state　estimation　with　weighted　least　square　turns　to　the　optimization　problem　with　equality　constraint.　At　last,　the　effectiveness　of　the　proposed　algorithm　is　verified　with　numerical　simulation　on　6-machine　25-bus　power　system,　and　the　computational　speed　is　fast　and　the　result　is　accurate.