The continuous increase in the demand of active and reactive power in the power system network has limits as scope for network expansion many a times poses serious problems. The power system must be able to maintain acceptable voltage at all nodes in the system at a normal operating condition as well as post disturbance periods. Voltage instability is a serious issue in the system due to progressive and uncontrollable fall in voltage level. The research presented in this thesis is concerned with several facets of the voltage stability problem. The focus of this thesis is to improve the voltage stability of the system. The sensitivity analysis plays an important role as it monitors the nearness of the system towards the voltage collapse situation. The conventional offline data as well as the online data are processed to determine the weak areas are determined. As the system is having nonlinearities it is governed by differential and algebraic equations which are in turn solved by nonlinear techniques. In this work the system is analysed with steady state model. Once the system is represented in the form of differential equations and standard form is achieved advanced control techniques can be easily applied for its solution. The main focus of this thesis is aimed at placing FACTS device known as the Static compensator (STATCOM) at weak location of the system network to address the problem of voltage instability. With its unique capability to control reactive power flow in a transmission line as well as voltage at the bus where it is connected, this device significantly contribute to improve the power system. These features turn out to be even more prominent because STATCOM can allow loading of the transmission lines close to their thermal limits, forcing the power to flow through the desired paths. This opens up new avenues for the much needed flexibility in order to satisfy the demands. The voltage instability is improved with reactive power supports of optimal values at optimal locations. Also renewable energy sources offer better option than the conventional types and hence attempt has been made to include the wind energy for this study the wind generator is considered delivering constant output and is assumed as a substitute to the conventional power generators. Finally the system voltage stability is studied with design of a controller based on probabilistic neural network. The developed controller has provided much better performance under wide variations in the system loads and contingencies and shown a significant improvement in the static performance of the system. The proposed controller is tested under different scenarios of line outages and the load increase and found to be more effective than the existing ones. The research has revealed a veritable cornucopia of research opportunities, some of which are discussed in the thesis.