The Microgrid is a small-scale controlled power system, which can be used in islanded mode or in a grid-connected one to provide power. In the islanded Microgrid, the system frequency will be affected severely by the smallest disturbance which can happen due to light inertia in the system. In the independent Microgrid, several generation sources such as solar, wind, and so on can be considered. In addition to these power plants, the discussion of energy conversion as a result of temperature changes can be considered as a thermoelectric converter. In the present article, the effort has been made to propose a microgrid model which incorporates a Thermoelectric Generator (TEG) system. In this system, due to the variety of uncertainties and load variations, an advanced controller must be developed to improve the dynamic stability and reliability of the microgrid system. The Improved Fuzzy Fractional-Order PID is the suggested controller. The proposed controller is applied to a sample islanded microgrid to establish a robust evaluation and to be checked under parametric changes, great demands, and disturbances. The offered controller is compared with those of other PID, FOPID and FPID controllers. The results of simulations reveal that the proposed controller has a proper and robust performance.