Power System Stabilizer (PSS) was proposed during 1960s to solve the low frequency oscillation problem raised by the wide application of the high-gain fast-response exciters. The fundamentals of PSS design lie in the angle compensation to increase the damping torque, which, since then, has become an important principle in designing the various power system dampers, such as SVC, TCSC, UPFC. Although many papers have been dedicated to the application of this principle, it is interesting to note that in the real industry applications PSS parameters have to be carefully tuned on site in spite of its mature design theory. So does the classical PSS design theory really meet the PSS design demand? By combining the frequency domain and the time domain analysis, this paper reinvestigates the basic idea behind the classical PSS design theory. The paper clarifies the concepts of the synchronous torque as well as the damping torque and proves that the classical PSS design principles based on these concepts are not theoretically sound. Then the paper discusses the Linear Optimal Controller Design method and analyzes its relations with the conventional PID design. By doing so the paper reveals the real mechanism of the PSS and proposes to use more systematic and advanced control tools to enhance the controller performance.power system stabilizer, low frequency oscillation, power system dynamics Citation: