Abstract: According to the defects of the existing reactive power compensation device which has bad dynamic performance and complicated structure, a new method of dynamic reactive power compensation is proposed. By analyzing the actual operating conditions and the experience formulas, the parameters of the device are determined. The designed filter works to remove the harmonic. Simulation test proves that the device has small harmonic content and good dynamic performance. The prototype (of 20kVar) is designed and linked to the network operation. It is proved that the reactive power compensation device’s structure is simple and practical.