The main aim of this paper is to control power oscillation which is major concern related to power system operation. In this research work is on SSSC-based power oscillation damping controller, which can damp the power oscillations occurring due to the any change in the transmission line like sudden change in load of line, occurrence of fault, transmission line switching and short circuit. In this work Simulation model of the two machine infinite bus system using SSSC & power oscillation damping controller has been done in MATLAB/SIMULIINK and power system toolbox is used for simulation purpose. These simulation models have been setup into MATLAB based Power System Toolbox (PST) for their transient stability analysis. It is observed that with the proper change of phase of the injection of voltages through SSSC, capacitive & inductive compensation can be provided by which increased and decreased in the active power respectively of transmission line can be done according to the mentioned power demand, but when only the SSSC is used in the line the settling time and amplitude of power oscillations are more as compared when SSSC is used with power oscillation damping controller. When in two machine infinite bus systems 3-phase fault analysis is done then it is observed that that the clearance time is less when the system is provided with SSSC and power oscillation damping controller together.