In power systems, voltage instability problems occur due to its continuous demand in heavily loaded networks. FACTS devices are increasingly employed in stabilizing the power systems. Among the FACTS devices, Static Synchronous Compensator (STATCOM) injects the compensating current in phase quadrature with line voltage and can imitate as inductive or capacitive reactance so as to produce capacitive power for the AC grid or draws inductive power from the AC grid to control power stream in the line. This paper proposes an algorithm named Firefly Algorithm, to get the optimal gain of the PI control of STATCOM under disturbances and helps in improving the performance and attaining a wanted response, irrespective of the variation of working conditions. This work is implemented under MATLAB/SIMULINK environment. And it shows better results over conventional PI and Adaptive PI control. © IAEME Publication.