In this paper, a grid-interactive photovoltaic (PV) system with the function of the power quality improvement is presented. The proposed system requires only one current-controlled voltage source inverter, which control the current flow at low total harmonic distortion and unity power factor, as well as simultaneously provide reactive power support. The proposed system operation has been divided into two modes (sunny and night). In night mode, the system operates to compensate the reactive power demanded by nonlinear or variation in loads. In sunny mode, the system performs power quality control (PQC) to reduce harmonic current and to improve power factor as well as maximum power point tracking (MPPT) to supply active power from the PV arrays, simultaneously. To verify the proposed system a comprehensive evaluation included simulation and experimental results are presented.