The stacked multiceli converter is one of the promising breeds of multilevel converters among the other several modified configurations presented in the literature. The reduced stacked multiceli converter is the most advanced one with less number of power switches and flying capacitors leading to a reduced size and cost. This paper proposes a reduced stacked multiceli converter based STATCOM to control the amount of injected/absorbed reactive power to/from the utility grid. The analytic model of the STATCOM is provided to systematically design a controller. Moreover, an active voltage balancing method is proposed to regulate the flying capacitor voltages of the reduced stacked multiceli converter controlled with level-shifted-carrier PWM. The circuit is simulated for different case studies and obtained simulation results are provided to show the performance of the proposed STATCOM, active voltage balancing scheme for flying capacitor voltages, and also its control system.