In this paper, a wavelet based approach is proposed for the model order reduction of linear circuits in time domain. Compared with Chebyshev reduction method, the wavelet reduction approach can achieve smaller reduced order circuits with very high accuracy, especially for those circuits with strong singularities. Furthermore, to compute the basis function coefficient vectors, a fast Sylvester equation solver is proposed, which works more than one or two orders faster than the vector equation solver employed by Chebyshev reduction method. The proposed wavelet method is also compared with the frequency domain model reduction method, which may loose accuracy in time domain. Both theoretical analysis and experiment results have demonstrated the high speed and high accuracy of the proposed method.