In this paper, we propose an on-line detection method for weak cable insulation and bad line switch contact by using power line communication (PLC) signals in the distribution network of low-voltage power system. In order to prove the feasibility of this method, firstly, we analyze frequency channel characteristic of distribution network in theory. Secondly, we analyze the change of PLC signal when the cable insulation is weak or the line switch contact is bad, and the signal is extracted by high-pass filter. Thirdly, we use fast Fourier transformation (FFT) algorithm to analyze the extracted signal in frequency domain and get frequency domain properties. Finally, we use these properties to identify types of deterioration. Simulation results verify the reliability of this method.