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Current harmonics, which are injected in the utility by nonlinear loads, cause major problems that tend to deteriorate the power quality at the mains. To reduce such harmonics, Active Power Filters (APF) are commonly employed. This paper gives performance analysis of current error space phasor based hysteresis controller for shunt active power filter, which allows precise compensation of harmonic currents produced by nonlinear loads. The controller keeps the current error space phasor within the hexagonal boundary (fixed band) by applying inverter voltage vectors which are adjacent to the output voltage vector (voltage vector at the point of common coupling). Region detection logic enables switching of inverter voltage vector which keeps the current error well within the prescribed hexagonal boundary. The controller has a self-adaptive logic which implements necessary sector changes effectively. Implementation of instantaneous reactive power theory for reference current generation is carried out using DSP TMS320LF2407A.