The　relation　of　line　shape　factor　and　micro　water　condition　from　the　perspective　of　microscopic　dynamics　is　analyzed　for　damp　condition　of　transformer　not　being　evaluated　directly　by　conventional　time　domain　dielectric　response　method.　The　different　dielectric　polarization　processes　hidden　in　the　polarization　current　were　resolved　individually　by　the　proposed　time-differential　method.　The　method　not　only　solved　the　line　shape　factor,　but　also　determined　the　number　of　relaxations　directly.　The　results　on　analysis　of　transformer　test　curves　shows　that　the　damp　condition　is　related　to　the　number　of　relaxations　and　line　shape　factors　closely.　The　larger　number　of　relaxations,　the　more　micro　water　in　the　insulation.　The　damp　condition　goes　worse　when　line　shape　factors　increase.　©　2017,　Harbin　University　of　Science　and　Technology　Publication.　All　right　reserved.