The design of an active surge controller, which employs Active Magnetic Bearings (AMBs) to stabilize the flow in the compressor, is presented in this paper. The axial tip clearance of an unshrouded centrifugal impeller from a single stage compressor is modulated relative to the static shroud to induce a pressure variation in the compressor output pressure. This fast-response, high-precision control of the output pressure is employed to stabilize the compressor operating in surge condition. The control law for the tip clearance is derived based on a recently introduced mathematical model, and the performance of the controller is tested through simulation.