The usage of electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs) has increased significantly in recent years due to environmental concerns and hike in the fossil fuel price. These vehicles possess dual dynamic characteristics. They act as a load while in G2V (grid-to-vehicle) mode and as a generator while in V2G (vehicle-to-grid) mode. V2G concept can improve utility grid performance with regard to efficiency, stability and reliability by offering reactive power management and active power control, tracking intermittent renewable energy sources, load balancing and shifting via valley filling support, peak load shaving and current harmonics filtering in the output. On the other hand, G2V includes conventional and fast battery charging that can stress the grid distribution network due to high-power rating of EV batteries and by injecting harmonics. Sophisticated active and reactive power regulation as well as state-of-the-art monitoring system is required to overcome the impacts and to implement successful interfacing. This chapter discusses the impacts of G2V/V2G concepts on the smart grid active and reactive power profile and their optimum control strategies. The importance of and the technologies needed for smart monitoring system in charging/discharging mode are also reviewed. Simulation results show that controlled implementation of V2G can significantly contribute to enhancing dynamic performance and stability of the microgrid under different operating conditions.