This paper presents a thyristor controlled LC (TCLC) filter for dynamic reactive power compensation. Compared with the traditional static var compensators (SVCs) like a fixed capacitor-thyristor controlled reactor (FC-TCR) which generates low order harmonic currents, the proposed TCLC can prevent the generation of harmonic currents. In this paper, the design of the TCLC parameters is investigated under the considerations of reactive power compensation range and transient performance. Moreover, the representative simulation and experimental results of the proposed three-phase three-wire TCLC are presented in comparison with the traditional FC-TCR.