Accurately describing the impact of air bubbles generated in the oil on the insulation performance between windings during inter-turn short-circuit faults in power transformers is of great significance for their stable operation. For the transformer winding turn-to-turn short circuit fault, firstly, a multi-physical field coupling model of transformer "circuit-magnetic field" in transient mode is developed in this paper, while the current and electromagnetic characteristics of transformer windings under fault conditions are investigated; then establishes the modeling of the transformer turn-to-turn short circuit, the magneto-electric coupling, and the field strength distribution, and further analyzes the discharge characteristics of the air bubbles in the transformer oil. Characteristics of the discharge of air bubbles in the transformer oil are further analyzed. Finally, COMSOL software is utilized to establish the simulation model. Simulation of collected continuous operation data of an oil-immersed transformer and screened data during low-voltage short-circuit faults. The simulation results show that: the electric field will produce distortion when passing through the bubbles, the field strength value increases instantly, and the distortion of the electric field increases with the increase of the number of bubbles, the insulation strength of the transformer oil between the turns decreases, and the insulation performance of the transformer is greatly affected.