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The main emphasis of this paper is to highlight the factors influencing power quality caused by compact fluorescent lamp (CFL) in terms of total harmonic distortion (THD) in current and voltage. Whole lighting system of a practical distribution network mostly comprises of fluorescent lights and incandescent lamps which are planned to be replaced by compact fluorescent lamps, nationally and internationally to promote demand side management (DSM), particularly in developing world due to short fall of electricity. Based upon the practical results obtained at RCET Lab Pakistan in consultation with UKM Malaysia, real model of CFL is developed in ETAP Harmonic Library to carry out simulations for the evaluation of required power quality parameters. While determining the impact of CFL at huge scale, current and voltage waveforms along with their spectrum for the HTs (High Tension side) and LTs (Low Tension side) of distribution transformers captured in the form of THDv and THDi have been analyzed for comprehensive analysis of power distribution system.