This document presents a study on implementing a Two-Degree-of-Freedom (2DOF) controller using Coefficient Diagram Method (CDM) techniques for controlling level in a three tank interacting system. The three tank system is mathematically modeled and linearized using Taylor series. The CDM technique is then used to design the parameters of the 2DOF controller based on the system model. Simulation results comparing the proposed 2DOF-CDM controller to a conventional PI controller show that the 2DOF-CDM controller provides more effective control of the nonlinear three tank system.