The objective of this thesis is to address the stability of a DFIG based wind generation system and improve the system’s performance by employing a power system stabilizer. The PSS signals are applied to the inner current control loops of Doubly Fed Induction Generator (DFIG) control scheme (voltage oriented control). The performance characteristics of PSS controllers based on the stator voltage and the network frequency, when the system is subjected to grid faults, are investigated. The system’s performance is demonstrated by the small signal stability analysis and time domain analysis. In the first step, analysis is carried out without any PSS and the need for PSS is addressed. In the next step, the system performance improvement witnessed with the use of PSS, is discussed. It is observed that the network damping and the system’s dynamic stability are improved when employing the designed PSS’s for DFIG based wind energy conversion system.