This paper presents simulation and hardware implementation of Load compensation by using DSTATCOM. This proposed DSTATCOM systems includes 1/z controller algorithm for control the system. Contributions are made in several aspects of the whole system, including inverter design, system simulation, controller programming, and experimental setup. The algorithm used for Load compensation by using DSTATCOM is the 1/z controller algorithm. In this method the error current can be measure and compare with reference current to achieve maximum power quality and maximum power deliver to source to load. The DSTATCOM consists of a inverter circuit, which is supposed to operate as the main part of the system, a three phase inverter is used. It provides the opportunity to have either higher or lower output voltage compared with the output. The resultant system is capable of load compensation by using DSTATCOM and obtained high power quality. The 1/z controller algorithm is used to compare error current with reference current and gives gate pulses to the inverter circuit. MATLAB and Simulink were employed for simulation studies. Experimental results indicate the feasibility and improved functionality of the system.