This paper presents the dynamic analysis of a multimachine small-hydro power system. Various mathematical models including hydraulic turbine prime mover model, induction generator model, electromechanical model, power factor correction capacitor bank model were employed to cater for the dynamic behavior of the system operating in load importing, load exporting, sequentially starting, and three-phase balanced fault situations. Simulation results showed that the system operated satisfactorily under those conditions. The dynamic study at preliminary planning stage is essential for a small-hydro project prior to construction.