This thesis describes an adaptive protection scheme that performs the collection of the voltage and current phasors during post-fault period, tracking the power swing phenomena, identifying the onset of instability, and then issuing a stabilizing command. In this work, the protection system is to maintain the reliability! ensure the secure operation, and prevent total collapse of the power system. The work is based upon methods of clustering for meter placement in a bulk power system, and selecting the pilot points for installing the phasor measurement units (PMU) to measure the bus voltage phasors and associated branch current phasors. According to the network law, fast calculation of state estimation can be made from these measurements. Because the on-line assessment of transient stability has to provide a quick and approximate result, the direct method which determines stability without explicit integration techniques is applicable in this study. The results of the system stability prediction in real-time by digital computer simulation under stable and unstable operating conditions are presented. / Master of Science