The main purpose of this study is to introduce a new software and hardware simulation method for a four zones Mho Directional digital distance relay, having an offset characteristic and allowing both forward and reverse power flows. The relay model is first developed using Lab VIEW, tested and validated using MATLAB/SIMULINK package for six operating and fault conditions. Lastly, a laboratory-scale model is implemented through data acquisition, short-circuit and lumped transmission line modules. Furthermore, Lab VIEW Front Panel serves as an improved Graphical User Interface (GUI) which leads to a more user friendly environment, better interaction and understanding in power system protection especially for inexperienced electrical engineers and provide hands-on training to students towards Project Based Learning (PBL). From impedance calculation point of view, the relay model is able to identify the proper zone of operation and determine the fault location as expected.