A matrix converter controlled 3-phase power electronics transformer is proposed for power system application. The proposed system uses three matrix converters and a three phase high frequency transformer in order to achieve isolation and, voltage and current transformation from primary to secondary. The primary side of the transformer is open-ended and two matrix converters connected to both sides of the opened primary side control the voltage by use of high frequency switching. By use of high frequency switching the size of the transformer is reduced. Another matrix converter connected to the star connected secondary side of the transformer converts back the high frequency chopped voltage at the output of the transformer to normal line frequency voltage by synchronized switching with primary side converters. By applying phase shift control to the forward rotating and backward rotating vectors the input power factor and output power factor are decoupled and unity power factor operation is achievable at the input.