This paper describes the effects of static VAR compensator on varying voltages in the system and the role of SVC in stabilizing these voltages. SVC is a relatively new technique for stabilizing the system voltages. It can control voltage accurately, continuously and rapidly. It helps in improving the transient stability of the system and voltage Variations due to sudden surges like lightning etc. The most important quality of SVC is that it can provide both the inductive and capacitive power as required. Simulink toolboxes are used in this paper to construct the static VAR compensator. The SVC consist of two main parts, Thyristor Switched Capacitor (TSC) and Thyristor Controlled Reactor (TCR). There are 3 TSC units and 1 TCR unit used in designing SVC. The TSC units will provide the capacitive power when the system voltage decreases than the rated voltage. The capacitive unit has the leading properties. In case the system voltage decreases by a large magnitude, multiple TSC units will be operated at the same time. Whereas TCR unit provides the inductive power when the system voltage increases than the rated voltage. The inductive unit has the lagging properties. A programmable voltage source is used in the simulations to vary the system voltages as desired by the user to check the response of the SVC controller. The author has also visited and reviewed the practical implementation of the SVC at one of the grid station and has used the same parameters in this paper as in the system implemented at the grid station. The SVC installed at the grid station has not been energized yet. This paper helps the author to compare the results of the simulations of the SVC implementation with that of practical one once the SVC is energized at the grid station. The results of the report show that the SVC works very effectively in keeping the system voltage stable in case of sudden Variations in voltages and reacts very quickly to the Variations. It can be concluded from the results that the SVC is an important part of the power system for the continued stability and reliability of the system.