Dynamic characteristics of smart hull structure are investigated and active vibration control performance is evaluated. Dynamic model of smart hull structure with surface bonded macro-fiber composite(MFC) actuators is established by analytical method. Equations of motion of the host hull structure are derived based on Donnell-Mushtari equilibrium equations for a thin cylindrical shell. A general model for the interaction between hull structure and MFC actuator is included in the dynamic model. Modal analysis is then conducted and mode shapes and corresponding natural frequencies are investigated. After constructing of the optimal control algorithm, active vibration control performance of the proposed system is evaluated. It has been shown that structural vibration can be reduced effectively with proper control input.