The virtual synchronous generator (VSG) has gained a more attention since it can emulate the essential inertial characteristics of the synchronous generator to the power electronic inverter based distributed generators (DG). VSG allows the inverter to participate actively in the frequency regulation. However, the stability analysis of VSG under parameter variations and critical value of the inertia value have not yet been discussed. To handle this issue, a small signal model of VSG is framed. The impact of parameters involving inertia, damping on dynamic response is analysed with Pole Zero map and the critical value of inertia is determined. Finally, the MATLAB/Simulink simulation results illustrates the perfection and viability of the theoretical analysis. © 2019 IEEE.