Power transmission lines are one of the most important components of electric power system. Failures in the operation of power transmission lines can result in serious power system problems. Hence, fault diagnosis (transient or permanent) in power transmission lines is very important to ensure the reliable operation of the power system. A hidden Markov model (HMM), a powerful pattern recognizer, classifies events in a probabilistic manner based on fault signal waveform and characteristics. This paper presents application of HMM to classify faults in overhead power transmission lines. The algorithm uses voltage samples of one-fourth cycle from the inception of the fault. The simulation performed in EMTPWorks and MATLAB environments validates the fast response of the classifier, which provides fast and accurate protection scheme for power transmission lines.