AbstractIn this paper we propose a novel Hamiltonian theory based controller design methodology for unified power flow controller (UPFC) control to improve the dynamic performance of power systems. The Hamiltonian theory of the differential‐algebraic (DA) system is described and a simple control strategy is deduced to stabilize the system. Furthermore, the influence of the control law on the stability region of the system is discussed as well. It can be proved that the stability region of the system can indeed be enlarged under the control strategy. The UPFC control scheme of multi‐machine power system is developed, and a classical three‐generator system is used to validate the effectiveness of the control law. Copyright © 2007 John Wiley & Sons, Ltd.