This paper investigates the nonlinear dynamics of power systems affected by the dynamics of static VAr compensators (SVC). The study reveals that the variety of dynamics of a power system have a tight relationship with a particular bifurcation which could be greatly affected by the parameters of SVC. Furthermore, the result of eigenvalue analysis indicates that those parameters can also decide the occurrence of the bifurcations and change the loci of the bifurcation points. The paper especially emphasizes the potential threat of the boost limits of SVC to voltage stability. The study provides an insight into voltage instability mechanisms based on the dynamics of SVC. The conclusions of the paper are verified by time domain simulation.