This paper describes an adaptive method for control of a TCSC device for power oscillation damping. The aim is to mitigate power oscillations in power systems with one dominating oscillation mode. To design the controller, a simple generic model of the power system with only a few variables is used. Initially, a fixed-parameter controller which is based on a pole-placement technique is designed. The controller is then implemented in a digital simulator and tested in a four-machine power system. The fixed-parameter controller performs well in most cases but in some contingencies, a performance decay is seen. To improve the controller performance, an adaptive control design has been investigated. The investigated controller is a self-tuning regulator and a recursive least-squares method is used to estimate the system model parameters. An open-loop controller for transient stability improvement and a closed-loop PI-controller for power flow control are also presented. The adaptive controller has been validated with good results by means of simulations of a number of contingencies in different operating conditions of the four-machine system.