To deal with the low frequency oscillation (LFO) of microgrid caused by power fluctuation and grid faults, virtual synchronous generator (VSG) as an effective solution has been intensively researched. In this paper, the process of frequency oscillation during disturbance is theoretically analyzed using power-angle curve and equal area criterion method. It is concluded that the deviation and changing rate of angular velocity can be changed by inertia time constant of VSG. Additionally, unlike the real synchronous generator, the parameters of VSG can be adjusted widely according to the specific situation; hence, in order to improve stability of microgrid, the improved adaptive inertia without using the derivative of angular velocity is proposed. The effectiveness of proposed method is verified through computer simulation.