An alternative method for designing a power system stabilizer (PSS) to be used with a single machine and infinite bus system (SMIB) developed on the basis of optimal control (OP) techniques is represented in this paper. The SMIB system is chosen due to simple configuration and useful for understanding the concepts of PSS and its basic effects. The effectiveness of the proposed scheme is tested through simulation to analyse the stability characteristics of the system's small signal about the operating condition at the steady state when a transmission line is lost. The focus of the primary method was on how the control would be performed. This was later proven to possess the responses with shorter settling time and a lower overshoot. © 2014 IEEE.