This paper presents harmonic disturbance impact on power factor improvement in power system. The Contents of this paper contains harmonic signification, harmonic current sources in power system, harmonic definitions and effect of power factor improvement by connected capacitors into power system with harmonic disturbance. Power factor improvement in power system with harmonic disturbance is caused of parallel resonance generation in power system as a result of matching impedance of inductive reactance of a power transformer and capacitive reactance of a capacitor at harmonic frequency. Parallel resonance phenomenon incurs harmonic voltage and current amplification. Harmonic voltage and current will dominate on capacitors in the power factor correction device and link to failure and damage on capacitors in the power factor correction equipment. Any problems of parallel resonance impact can be avoided and corrected by connecting series reactors to capacitors in the power factor correction device. Series reactors will move a point of parallel resonance from significant harmonic order to non-significant harmonic order and partial reducing harmonic current in power system. However, if power system contains a lot of harmonic current quantity the filter of harmonic current shall be installed in power system for reduce harmonic current in power system.