This is a dissertation by the author, submitted to the Dept. of EEE, Bangladesh University of Engineering and Technology in October 2009, in partial fulfillment of the degree of Master of Science in Engineering. This thesis presents the outcomes of a research aimed at studying the application of controllable series compensation to enhance power transmission capability of East-West Interconnector which is the bridging power corridor between greater Eastern and Western Grid of Bangladesh Power System. Series compensation has been implemented by a well-known and widely applied member of FACTS family, Thyristor Controlled Series Capacitor (TCSC). Transmission capability improvement has been studied by comparing Static and Dynamic Loading Margins of the system, determined based on Saddle-Node and Hopf Bifurcation theory. System modeling and analyses have been performed by computer based simulation tools such as PST, UWPFLOW and MATLAB/Simulink. A simplistic financial appraisal of TCSC installation project in Bangladesh context has also been presented in this dissertation.