This paper presents an improved direct power control (DPC) strategy for grid-connected voltage source inverter (VSI) under unbalanced and harmonic grid voltage conditions. Based on the mathematic model of VSI with the negative sequence, 5th and 7th harmonic voltage components consideration, a PI controller is used in the proposed DPC strategy to achieve the average output power regulation. Furthermore, vector PI controller with the resonant frequency tuned at the two times and six times grid fundamental frequency is adopted to regulate both negative and harmonic components, and then two alternative targets of the balanced/sinusoidal current and smooth active/reactive output power can be achieved. Finally, simulation results based on MATLAB validate the availability of the proposed DPC strategy.