Growth of electric power demand leads to growth in electric power systems. So AC transmission systems must be controlled fast enough and practical enough to handle the variation of power system conditions. Many traditional controllers were used before with the design of transmission systems but greater operating flexibility and better utilization of these transmission systems could not be achieved with these traditional controllers. A unified power flow controller (UPFC) can provide fast and realtime control of power systems. In this paper an algorithm of a unified power flow controller is suggested. Through this suggested algorithm, the UPFC is able to control both real and reactive power flow of a transmission line independently. This is achieved through deriving of analytical equations leading to direct relationship between the power flow to be controlled in a certain transmission line and the controller parameters that presented in the equivalent circuit describing the steady state model of the UPFC.