In this article the performance of a DISTATCOM as an efficient parallel compensator, for obtaining the power indexes has been considered, then, to improve the performance of DISTATVOM, each of its PI controller has been substituted by a non-liner fuzzy-neural controller, based on trial error and derivation of system error. The cause of detorioration of power quality and the method of their compensation, in a distribution network, has been analysed, using Matlab. The simulation results show that, by using the fuzzy-neuralcontroller in place of linear controller in DISTATCOM controller, the ability of compensation in the active and reactive power voltage sag, swell and fliker, and reduction of low current and voltage harmonics has been improved cansiderably.