This paper presents the development of a three phase current source hybrid power filter (CSHPF) which is designed to compensate the source current harmonic distortion of nonlinear power converters. It is an alternate power filter circuit to voltage source inverter (VSI) based hybrid power filter for harmonic current compensation. CSHPF overcomes the limitations of standalone passive power filters, voltage source based active power filters and the classical PI controllers of active power filter. The control method involves the concepts of the P–Q theory and fuzzy logic based intelligent control to compute the reference compensating currents. This paper considers fuzzy logic control method for DC link current regulation in CSHPF. Current source hybrid power filter is suitable for compensating inter harmonic components produced by saturated machines and arcing devices. The proposed CSHPF and the control technique have been implemented in simulation environment using Matlab Simulink and experimental setup using FPGA controller to illustrate its performance in harmonic current compensation.