Previous publications regarding the design and specifications of the interface inductor and the DC side capacitor for a STATCOM usually deal with the interface inductor and the DC side capacitor only. They seldom pay attention to the influences of the interface inductor and capacitor on the performance of a STATCOM system. In this paper a detailed analysis of influence of the interface inductor and the DC side capacitor on a STATCOM system and the corresponding design considerations is presented. Phase and amplitude control is considered as the control strategy for the STATCOM. First, a model of a STATCOM system is carried out. Second, through frequency domain methods, such as transfer functions and Bode plots, the influence of the interface inductor and the DC side capacitor on the stability and filtering characteristics of the STATCOM are extensively investigated. Third, according to this analysis, the design considerations based on the phase margin for the interface inductor and the DC side capacitor are discussed, which leads to parameters that are different from those of the traditional design.