An improved hybrid unified power flow controller (IHUPFC) is developed in this paper to control power flow and increase utilization rate of the existing transmission lines. The IHUPFC is composed of an improved “Sen” transformer (IST) and a small capacity UPFC. After a detail introduction of the structure and voltage regulation performance of the IST, this paper derives the capacity relationship between the IST and the UPFC. Then this paper introduces the technology of IHUPFC in power flow regulation and transmission capability improvement. Besides, the advantages of the IHUPFC in performance and structure are analyzed. The IST has simpler structure and larger power flow control area than “Sen” transformer and the IHUPFC provides a continuous active and reactive power flow control. Simulation and experiment studies are used to verify the practicability and superiority of the IHUPFC.