Transparent substation is based on ubiquitous micro smart sensors and sensor networks, using smart electrical equipment as the carrier, combined with digital technologies such as cloud computing, big data, internet of things, mobile internet and artificial intelligence technology, and finally make substations comprehensive visible, knowable and controllable. The article first analyzes the development needs of transparent substations, and expounds the basic concepts of transparent substations from two aspects: the definition and main characteristics of transparent substations. Then emphatically put forward the transparent substation system architecture including edge perception layer, network layer, platform layer and application layer, and analyzed the key technical constraints of transparent substation. Finally, the concepts of transparent substation and smart substation are discriminated from four aspects: development background, driving mode, construction goal and system architecture, hoping to provide a useful reference for the construction of the transparent substation.