Power system stabilizer based on optimal pole shifting is proposed. An approach for shifting the real parts of the open-loop poles to any desired positions while preserving the imaginary parts is presented. In each step of this approach, it is required to solve a first-order or a second-order linear matrix Lyapunov equation for shifting one real pole or two complex conjugate poles, respectively. This presented method yields a solution, which is optimal with respect to a quadratic performance index. The attractive feature of this method is that it enables solutions of the complex problem to be easily found without solving any nonlinear algebraic Riccati equation. The present power system stabilizer is based on Riccati equation approach. The control law depends on finding the feedback gain matrix, and then the control signal is synthesized by multiplying the state variables of the power system with determined gain matrix. The gain matrix is calculated one time only, and it works over wide range of operating conditions. To validate the power of the proposed PSS, a linearized model of a simple power system consisted of a single synchronous machine connected to infinite bus bar through transmission line is simulated. The studied power system is subjected to various operating points and power system parameters changes. (C) 2011 Elsevier Ltd. All rights reserved.