The paper investigates the use of Thyristor Controlled Series Capacitor (TCSC) for improving small signal stability and managing congestion in heavily loaded power systems. Utilizing Particle Swarm Optimization (PSO), it determines the optimal locations and parameters for TCSC installation to enhance system oscillation damping and alleviate line flow congestion. The findings indicate that strategically placed TCSC controllers can effectively mitigate small signal issues and enhance power flow management in multimachine power systems.