Power Quality (PQ) disturbances are becoming increasingly important concerns of the network operators and customers during the delivery of power. Voltage dip is one of the PQ disturbances which is caused by different factors but mainly by the unpredictable faults occurring at different parts of the electrical network. Dips originating at some parts of the network may propagate to other parts of the network causing huge Financial losses to industrial and commercial customers. Knowing the maximal fault impedance beyond which dips are not detected by the monitoring equipment is very helpful for the grid operator. This paper mainly focuses on the influence of critical impedance or distance, which is measured from a point of common coupling (PCC) at the main busbar next to the IlV/MV transformer to the fault point, to the monitoring of dips. A typical Dutch MV network is analyzed and mathematical models are developed with different fault types. Taking the different grounding techniques into account, simulations are performed using MATLAB. For industrial customers connected to the same PCC, the critical distances corresponding to each fault types are evaluated and compared. Based on computer simulations, the dips missed by the monitoring device placed at the most appropriate location are thoroughly discussed. The influence of different system groundings on the phase and line voltage dips are also explained in this paper. Moreover, the transfer of dips from MV to LV network and the impact of the critical distance with each fault to the transfer of dips are briefly explained.