The applications of Power quality at industrial and commercial scale is very important to be assured for the customer. But due to some reasons the load power system destructed like Sags of voltage, destruction of harmonics, irregularity in the voltage waveform and transient. Sensitive devices of power may also be harshly effected by voltage sags and change in the harmonics. Due to increase the heat in the power system devices and electrodes problem of harmonics could occur that may lead to failure of different speed drives and spin pulses in motors. The necessary requirement in the power system is decrease in harmonics. The use of DVR (Dynamic Voltage Restorer) in the power system devices is the source of reduction of this problem. To overcome the disturbance of voltage Sag and harmonics, it is the efficient and economical solution. Reduction of Total Harmonic Distortion (THD) will increase the quality performance of power system. Dynamic Voltage Restorer is used in this paper. Reduction in % THD and voltage sag are successfully corrected by using DVR on MATLAB/SIMULINK Software Package.