The invention provides a simulation method of a unified power flow controller. The simulation method comprises the steps of acquiring a steady-state running parameter required by power flow calculation of a power system; and obtaining control signals of a parallel side and a series side of the unified power flow controller according to the steady-state running parameter and a parallel-side converter model and a series-die converter model, which are built in advance, of the unified power flow controller, wherein the parallel-side converter model and the series-side converter model both comprises dual-loop control and mode selection. By the simulation method, the power transmission characteristic of the unified power flow controller (UPFC) can be accurately simulated, the condition of excessively large current caused by short circuit during running of the UPFC can be simulated, and a d-axis current and a q-axis current can be conveniently controlled.