A hybrid parallel active filter / off-line uninterruptible power supply (UPS) system is proposed. The hybrid system contains a single inverter which acts as a parallel active filter during the normal mode of operation (when the AC supply is available); and also supplies the load withenergy from the UPS back-up battery during the back-up mode of operation (when the AC supply is not available or is beyond the preset tolerance). In both modes of operations the inverter is controlled in such way so that the line current is a pure sinusoid. This is to improve the input power factor and to eliminate the current harmonics in the first mode and to remove any stress on the back-up battery caused by the discharging during the second mode of operation. A full simulation results and an experimental setup is presented together with a closed loop control algorithm.