The characteristics of overvoltage are closely related to the system grounding mode,which is of great significance to the selection and design of key equipment. However,the research on grounding mode selection combined with overvoltage analysis in DC distribution network is still imperfect. Firstly,the mechanism of overvoltage generation is analyzed for ±10 kV dual-terminal DC distribution network based on modular multi-level converter (MMC),and the overvoltage peak values at key positions of the system under three typical grounding modes are compared by fault simulation in PSCAD/EMTDC. Then,the fault recovery ability,economy,voltage stability and overvoltage peak value are proposed as the indexes for the comprehensive selection of grounding mode. Grounding by resistance through neutral point of the transformer in AC side and ungrounding in DC side is evaluated as the preferred grounding mode of the studied system. Finally,the arrester parameters and configuration scheme are determined based on the chargeability calculation design method,and the validity is verified by simulation. References for the selection of grounding mode and insulation configuration of DC distribution network are supplied by the research.