The transient electromagnetic method (TEM) using the high-current and small coil is a mature technology in the prospecting for metallic ore deposits and groundwater. Based on many years’ experimental studies, the authors analyzed the causes of negative value V2(Induction of secondary field) at the top of the fault and put forward the exploration and data-processing means for faults, new faults and geological collapses. This paper summarizes the method of TEM for determining concealed active faults (CAF).Drilling has demonstrated that this method is convenient in accurate determination of CAF.