A three-phase AC generator has a rotor with a rotating magnet placed within the stator mounted with the stationary three-phase winding to generate three-phase voltages via mutual induction. These windings are evenly distributed around the inner circumference of the stator and are arranged 120 electrical degrees apart. Three-phase stator windings consist of three separate coils or groups of coils, known as phases, each connected in Y (star) configuration or Delta configuration.

As the rotor spins, its rotating magnetic field intersects with the stator windings and induces equal-magnitude voltages, having a phase difference of 120 degrees. Each winding acts as a single-phase generator, enabling the three-phase generator to power both single-phase and three-phase loads. The three-phase system comprises three voltage sources connected to loads using three or four conductors. In a Y-connected system, the voltage sources have identical amplitude and frequency and are separated by 120 degrees; the voltages across lines a, b, and c to the neutral line represent the phase voltages. These voltages are called balanced when equal in magnitude and phased out by 120 degrees from each other. In a Delta-connected voltage source with identical amplitude and frequency, and a phase difference of 120 degrees, the voltages between lines a, b, and c do not involve a neutral line and are known as line voltages. These line voltages are called balanced when equal in magnitude and maintain a 120-degree phase difference from each other.

In a wind turbine, the rotating blades spin the generator's rotor, inducing a three-phase voltage in the stator coils, which is then transformed and transmitted to the grid.