Power quality is a major concern for electrical engineers and researchers now days. Various power quality problems are voltage sag, swell, interruptions, harmonics etc. This paper discusses the problem of harmonics and its reduction in distribution network against the induction motor drive load. Harmonics distortion is reduced using Distribution static compensator (DSTATCOM) modeling in the MATLAB/ Simulink environment. The control technique used is Instantaneous power theory which calculates the required current injected into the power system. The simulated results show the effectiveness of DSTATCOM in reducing harmonics distortion.