This paper deals with the dynamic harmonic filtering using hysteresis current control based hybrid shunt active filter. The main harmonic sources of distribution system are the non linear loads and frequent switching surges industrial loads. The non linear loads have unequal loading over a period of supply thus it alters the voltage and hence current. The switching of loads produces voltage sag and swells which leads to harmonics in the lines. The proposed hybrid shunt active filter is fully characterized by series LC and shunt DC link connected through 3-phase active filter. The disturbances in the supply voltage and load current due to frequent switching and non linear loads of 415 V, 50 Hz distribution system are observed using CW240 power quality meter. The same is simulated in MATLAB with and without filter. The simulation results obtained from the proposed method proves that it gives comparatively better THD value.