This paper proposes a directional protection with phase, positive sequence, negative sequence, and zero sequence units by using the scaling coefficients of the real-time stationary wavelet transform (RT-SWT). As directional protection activators, the wavelet coefficients are used for fast detection of the fault inception time, whereas the scaling coefficients are used to provide backup activators in accordance with the overcurrent protection. Evaluations prove the feasibility to rebuild the traditional directional protection by using RT-SWT. However, the proposed wavelet-based directional protection provided better performance and faster operating time than the conventional one based on the discrete Fourier transform (DFT). As new functionalities, the wavelet-based negative sequence unit can be used to detect three-phase faults, even with severe voltage sags without memory strategies, which is not possible with the conventional protection. In addition, the proposed protection was implemented in hardware in order to demonstrate its practical feasibility