Nowadays power systems operate with a high level of security, however, several blackouts still occurred around the world in recent decades, although usual protection methods in three-defence-line scheme are widely used against occurrence of blackouts. In such circumstance, controlled islanding has been proposed as one way of preventing blackout from spreading. The choice of controlled islanding scheme is independent of the particular actions in the three-defence-line procedure taken. Typically, during the fast cascading stage before an imminent blackout, a large number of lines and generators are tripped and make the system stressful in 'N-k' reliable situation. This paper will demonstrate the system performance in 'N-k' situation and investigate if this will cause a blackout. While, four main interacting indicators should be involved in this process, including static overloads, voltage problems, transient stability and frequency stability. In this paper, the main objective is to assess on-line transient stability in prediction mode using the Extended Equal Area Criterion (EEAC) and adopt it in cascading outages and find out the point of no return, i.e. the determination of when to island.