Considered one of the most essential problems of power quality, Voltage Sag is related to renewable based distributed generation (DG) units. Using two types of compensators: Distribution Static, also known as (D-STATCOM) and Static VAR, also known as (SVC), this paper handles the issue of voltage sag. Modeling and simulation of hybrid PV-Wind system is proposed in this study. The proposed system is examined under voltage sag incident caused by two factors: a sudden heavy load and faults that are related to short circuit, e.g., single line to ground, double line to ground and three phases to ground faults. A hybrid wind-PV system is presented using MATLAB/ SIMULINK software package. According to the simulation results, the voltage sag is effectively mitigated after using D-STATCOM, which shows efficient voltage recovery compared with SVC.