Since low-frequency oscillation seriously threatens the safe operation of the power system, the power system stabilizer (PSS) can effectively suppress the oscillation. In this paper, a hybrid parameter optimization method combining the moth-flame optimization (MFO) algorithm and fuzzy logic controller (FLC) is proposed to address the problem of poor adaptability of the parameter tuning method in the conventional power system stabilizer (CPSS). This method can optimize the parameters of PSS in different processes. Initially, the optimal parameters of PSS under the current perturbation are given by the MFO algorithm. During the online operation of the system, as perturbation changes, the parameters of the PSS will also be adaptively tuned by the FLC in real-time when the system operating conditions change. According to this method, a fuzzy adaptive proportional–integral–differential (FPID) controller is designed based on the moth-flame optimization algorithm (MFO-FPID), and it is used as PSS to improve dynamic stability performance during oscillation. Moreover, its parameters can be adaptively adjusted in different perturbation scenarios. The designed MFO-FPID controller is applied to the single machine infinite bus (SMIB) power system to compare the dynamic performance with other controllers, that is, proportional–integral–differential (PID) and CPSS. The result shows that the MFO-FPID controller can suppress the oscillation very well, and the control effect is the best.