The effective and reliable use of existing transmission lines are critically important because high-voltage transmission networks met enormous power demands are very expensive investments in terms of their costs. Flexible Alternating Current Transmission Systems (FACTS) are quite efficient to control the power flow of the transmission lines and increase the current capacity of system. Unified Power Flow Controller (UPFC) is the more efficient among FACTS equipments which have the potential to increase the power flow and stability of the transmission line. This paper develops new control approaches for both series and shunt inverters of UPFC. The proposed controller algorithms of shunt and series inverters are based on fuzzy logic controller and rotating orthogonal-coordinate method, respectively. Dynamic control of power flow using proposed UPFC is analyzed as mathematically. Power System Computer-Aided Design (PSCAD) is used to simulate the system and test UPFC in the simulation environment. The test results are presented to show the increased stability of the system and improved dynamic response of UPFC during faults occurred in the transmission line. Crown Copyright (C) 2010 Published by Elsevier B.V. All rights reserved.