Photovoltaic (PV) technology achieves great interests from its non-polluted operation and flexible installation. The obstacle is the hotspot on the PV panel's surface which is the consequence of shading, occurs as the heat and cause the damage to the PV's system. The conventional method for detecting the hotspot is the usage of the infrared camera; however, trades of cost and manpower are the main disadvantages. Moreover, the hotspot and partial shading have similar effects to the PV's system which is the reduction of the output current and generated power. It is essential not only to detect but also differentiate the hotspot from partial shading. This paper proposes the algorithm for detecting the hotspot and partial shading on the PV array by analyzing the PV's characteristic curves. Proposed algorithm's efficiency is confirmed by the system implementation and shows success detection in different levels of hotspot defections.