Accurate knowledge of oscillation parameters (i.e., frequency, amplitude, phase, and damping factor) is crucial for control strategies of power systems under power swing. This paper presents a method for the parameter estimation of power system oscillation signals under power swing based on Clarke–DFT. The proposed method provides accurate parameter estimation of damped sinusoidal signals for both balanced and unbalanced systems, which performs well even in the presence of harmonics. In the meantime, the negative frequency components in the spectra of the damped sinusoidal signals, which are caused by system imbalance, are calculated accurately using complex-valued interpolated DFT. To verify the performance of the proposed method, simulations are performed under balanced and unbalanced conditions. The results of the simulations confirm the effectiveness of the proposed method either in unbalanced or harmonic conditions.