This paper presents the fuzzy logic controller for shunt active power filter used to compensate harmonic distortion in a three-phase system. The shunt active filter employs a simple method for estimating the reference compensation current. A fuzzy logic based current control strategy is used to regulate the filter current and hence ensure harmonic free supply current. Classic filters may not have satisfactory performance in fast varying conditions. However, an auto-tuned active power filter gives better results for harmonic minimization and power factor improvement. The proposed fuzzy based shunt active filter maintains the THD well within IEEE-519 standards. The validity of the presented approach in harmonic mitigation is verified by simulation results in MATLAB/ Simulink and hardware prototype.