Power quality (PQ) enhancement is an important area of research in which all the stake holders like residential and industrial sectors are responsible to manage the power effectively and efficiently at an optimistic level. This paper suggests an improvement of PQ using Distributed static compensator (DSTATCOM) for compensating the concerns of PQ in direct coupled mode. This requires a proper design and implementation of direct filtering with and without LC Filter. This is achieved using DSTATCOM in order to compensate reactive power and proper establishing its voltage magnitude and its phase angle. An important strategy of icos ϕ control has also been implemented. This icos ϕ control used as an optimal current harmonic extractor to generate the appropriate firing pulses. This algorithm has been carried out using MATLAB Simulink model. An important realistic approach using the suggested system of direct coupled distributed Static Compensator (DC-DSTATCOM) has been implemented in the power system utility (PSU) to achieve high accuracy, compatibility and flexibility as compared to other conventional approach. The comparison study is analyzed with the DC-DSTATCOM without LC connected filter and DC-DSTATCOM with LC connected filter. It is observed that the suggested system of DC-DSTATCOM with LC connected filter mode happens to be more effective in improving DC voltage regulation across the self-supported capacitor, voltage balancing at the side of PCC (point of common coupling) and decrease in harmonics at source side. This shows an enhancement of PQ attributes under different loading conditions