The improved efficiency and controllability inherent with the doubly fed induction generators (DFIGs) is bringing this technology to the forefront of power industry. However, the dynamic behavior of these machines is different from those of synchronous machines. Apparently, the large penetration of these machines entails a change in dynamics and operational characteristics of the system as a whole. Given this assertion, the present paper develops an approach to analyze the impact of increased penetration of DFIG based wind turbine generators on transient and small signal stability of a large power system. The primary basis of the method is to convert the DFIG machines into equivalent conventional round rotor synchronous machines and then evaluate the sensitivity of the eigenvalues with respect to inertia. In this regard, modes that are both detrimentally and beneficially affected by the change in inertia are identified. These modes are then excited by appropriate disturbances and the impact of reduced inertia on transient stability performance is also examined. The proposed technique is tested on a large test system representing the Midwestern portion of the U.S. interconnection. The results obtained indicate that the proposed method effectively identifies both detrimental and beneficial impacts of increased DFIG penetration both for transient stability and small signal stability related performance.