This paper proposes a new concept for limiting fault current in distribution systems with interline bridge-type fault current limiter (IBFCL). It includes two or more BFCLs connected to only a common limiting resistor in DC link, which result in considerable cost saving. This configuration is inserted in series with feeders connected to a point common coupling (PCC). At first, the principle and characteristics of IBFCL are described. Then, a theoretical analysis of limiting performance and parameter design of the IBFCL is explained. Finally, the performance of the IBFCL for limiting fault current is validated on the distribution system comprising of parallel feeders connected to PCC through electromagnetic simulations by PSCAD/EMTDC under symmetrical and asymmetrical faults as well as different load current conditions. Simulation results show that the IBFCL provides a cost-effective approach for limiting fault current in distribution system.