This study proposes a new power system stabilizer based on fuzzy system. The new controller is applied to a wind turbine generating system comprising of a wind turbine driving a 3-phase synchronous generator connected to a large power system. The new controller significantly improves system performance. The enhancement in the dynamic response of the system is verified through simulation results of a system under different operating points and exposed to both small and large disturbances. Extension to the wind energy distributed generation based multi-machine case is also included to illustrate the effectiveness of the proposed stabilizer in damping power system swing mode oscillations that follow disturbances.