Modern microprocessor capabilities permit the control designer to consider using relatively complicated nonlinear control algorithms, which would have been considered impractical in the past. The paper presents the results of a study of the potential usefulness of nonlinear decoupling algorithms for the design of excitation and governor controllers for a power system using state-variable feedback. A control law for decoupling rotor angle and field flux is derived. For the rejection of load disturbance, the design of a servocompensator consisting of strings of integrators in the outer ioop around the decoupled inner loop is proposed. The closed-loop system is shown to be asymptotically stable. The system can be transferred to a new operating condition corresponding to any desired terminal voltageVtand tie-line powerPtieThe simulation results using a first-order compensator show that system asymptotically tracks the desiredVtandPtieunder unknown piecewise constant disturbances. Results show good transient and steady-state responses in rotor angle, field flux and frequency. Steady-state errors inVtandPtieowing to parameter uncertainty are reduced to zero by changing the command inputs using an external loop. The effect of stochastic load on the response is small.