Towards the reactive compensation feature of distribution network and integral substation, this paper proposed an integration structure of distribution transformer and STATCOM (DT-STATCOM). It use the surplus capacity of transformer to compensate the reactive power; by setting the connect voltage flexible, it extended the switching devices selection; the integration structure reduce the volume and cost of compensation device. Based on the structure of DT-STATCOM, this paper proposed two novel reactive current detection method across the transformer's ports. Then the paper designed the decision control system using multi-lateral information. Simulation result showed that, the DT-STATCOM system had significant effect on dynamic reactive power compensation, transformer voltage support and imbalance inhibition.