The safe operation of a power grid requires the quick non-destructive location of defects in power cables before faults occur. Insulation ageing and physical wear and tear may damage underground power cables. Although defective cables can temporarily transport electricity, the inability to detect local insulation defects early on can result in serious power failure due to the action of electric fields. Power cables are laid underground in narrow space channels and are therefore inaccessible to most inspection equipment. Hence, only inspection methods that can inject voltage/current waves from the terminals of cables can be applied to these cables. This paper presents a non-destructive and accurate method to detect local defects in power cables. The method measures the reflection coefficient (S11) spectrum at one end of the cable and uses inverse fast Fourier transformation to determine the location of the defect. First, a cable distribution parameter model is established and the feasibility of using the S11 spectrum to locate local defects is proven in detail. Next, a simulation model of the local insulation defect is built and different local defects caused by variations in cable distribution parameters are subsequently simulated. Finally, experiments are conducted to locate defects in low-density polyethylene (LDPE) and cross-linked polyethylene (XLPE) cables. The proposed method is non-destructive and highly sensitive and can quickly find defects. Simulation results show that defects can be accurately located with a spatial resolution as small as 0.01 m, even if the distribution capacitance changes by only +2.5%. In addition, the method can accurately identify locations of abnormal temperature before a fault occurs in the cable, which is of great significance for quick and accurate inspection as well as in the provision of an early warning of power cable defects.