With the growth of power system interconnections, the economic drivers encourage the electric companies to load the transmission lines near their limits, therefore it is critical to know those limits well. One important limiting issue is the damping of inter-area oscillation (IAO) between groups of synchronous machines. In this Ph.D. thesis, the contribution of power system components such as load and static var compensators (SVC) that affect the IAO of the power system, are analysed. The original contributions of this thesis are as follows: 1-Identification of eigenvalues and mode shapes of the IAO: In the first contribution of this thesis, the eigenvalues of the IAO are identified using a correlation based method. Then, the mode shape at each identified resonant frequency is determined to show how the synchronous generators swing against each other at the specific resonant frequencies. 2-Load modelling and load contribution to damping: The first part of this contribution lies in identification of the load model using cross-correlation and autocorrelation functions . The second aspect is the quantification of the load contribution to damping and sensitivity of system eigenvalues with respect to the load. 3- SVC contribution to damping: In this contribution the criteria for SVC controller redesign based on complete testing is developed. Then the effect of the SVC reactive power on the measured power is investigated. All of the contributions of this thesis are validated by simulation on test systems. In addition, there are some specific application of the developed methods to real data to find a.) the mode shape of the Australian electricity network, b.) the contribution of the Brisbane feeder load to damping and c.) the effect of the SVC reactive power of the Blackwall substations on the active power supplying Brisbane.