Owing to fuel scarcity and environmental contamination set off by the conventional sources, renewable energy resources rule the world of power generation. Up gradation of energy production through wind farms is being encouraged now-a-days, as the wind power is dirt free, readily available renewable alternative. The integration of wind farms with power grid leads to Power Quality (PQ) issues such as voltage sag, swell, flicker, harmonics etc. Most of the industrial and commercial loads are of non-linear type which indeed the starting place of harmonics. As 70% of PQ problems are voltage sag which is one of the most severe disturbances to sensitive loads. As an outcome of the aforementioned issues both consumer sector and production sector gets affected with poor quality of power which urge PQ enhancement at its best level. Among many of custom power devices, Unified Power Quality Conditioner (UPQC) is the only device used to diminish both voltage sag and current harmonics. This paper analyzes PQ problems, voltage sag and current harmonics due to the interconnection of grid connected wind turbine and also provides PQ enhancement by introducing UPQC. To improve the performance of UPQC, a novel control strategy using Fuzzy Logic Controller (FLC) is proposed which eliminates the drawback of using fixed gains in conventional PI controller. From the simulation results, by comparing controller performance, the proposed fuzzy controlled UPQC provides effective and efficient mitigation of both voltage sag and current harmonics than the conventional PI controlled UPQC, thus making the grid connected wind power system more reliable by providing good quality of power.