Phase shifter has been used as a means of power-flow control and for transient stability improvement in AC transmission system. Until now, phase shifters have been based on an injection transformer. Conventional phase shifters with tap changers require regular maintenance and allow only step-like control of the phase angle. This paper propose a three-phase phase shifter using PWM AC/AC converter, which can improve system response and control stability in the applications. This paper deals with the circuit topology, operating principle so that the features of the phase shifter will be shown through computer simulation, especially using PSIM software.