The growing complexity of modern power systems, driven by increased demand, renewable energy integration, and deregulation, has created significant challenges in maintaining stability and reliability. Flexible AC Transmission Systems (FACTS) devices have emerged as effective tools for enhancing power system performance by improving voltage stability, increasing power transfer capability, damping oscillations, and ensuring optimal utilization of transmission infrastructure. This paper investigates the application of FACTS devices for stability enhancement, focusing on major types such as Static VAR Compensators (SVC), Static Synchronous Compensators (STATCOM), Thyristor-Controlled Series Capacitors (TCSC), and Unified Power Flow Controllers (UPFC). The methodology includes simulation-based evaluation of a two-area power system model under various fault conditions, comparing system response with and without FACTS integration. Results indicate that STATCOM and UPFC significantly enhance transient stability and reduce oscillation damping times, while SVC and TCSC provide cost-effective voltage regulation and power flow control. The study concludes that FACTS devices are indispensable for ensuring reliable and stable operation of modern power grids, particularly in the context of renewable energy penetration and deregulated markets.