This paper proposes a three-phase single-stage grid integrated solar photovoltaic distributed static compensator (SPV-DSTATCOM) system using a leaky least mean fourth (LLMF) control algorithm. The prime contributions of this paper include: 1) the SPV generating system, which fulfills the active power requirement of connected loads and supplies the excess power to the grid; 2) the voltage-source converter (VSC) acts as a dc-ac inverter and DSTATCOM, which provides reactive power compensation, harmonics filtering, load balancing, power factor correction, zero voltage regulation, and mitigates several other power quality issues; 3) even when the SPV power is unavailable, the VSC operates as a DSTATCOM, which enhances the utilization factor of devices; and 4) the LLMF-based control approach for fundamental component extraction from load currents for good harmonics compensation as well as to keep the overall system stable and to achieve rapid response at changing conditions. The proposed system is modeled and simulated using MATLAB/Simulink as well as its performance is verified experimentally on a developed prototype.