In order to improve operators’ situation awareness of dealing with loop closing scenarios, a fast simulation method of distribution network loop closing based on compensation method and nodal equation was proposed to simulate the influence of loop closing on distribution network rapidly. The change of loop closing electrical quantities was depicted by compensation method, and loop closing simulation formulas based on incidence matrix and admittance matrix were derived with nodal equation to quantitatively describe the influence of loop closing on distribution network. Only running state and network parameters before loop closing were needed to calculate the state after loop closing, and there was no need to recalculate power flow. The PG&E 69-node system and a practical distribution network were simulated, and the results proved the validity and practicality of the proposed method.