Microgrid (MG), a revolutionary concept in the energy infrastructure, plays an important role for the establishment of a resilient grid infrastructure. Since its emergence, it has evolved around a number of cutting edge technologies for its smooth operation and control. Among them multi-agent system (MAS) provides an intelligent and decentralized platform for the control of microgrid. This paper highlights the application of a MAS in an AC microgrid, including a detailed structure of microgrid, the communication interface between microgrid and multi-agent platform. A detailed small scale microgrid model has been simulated in MATLAB/SIMULINK environment, whereas the agent platform has been implemented in JADE (Java Agent Development Framework) platform. The MAS autonomously detects main grid outage and facilitates seamless transition from grid-connected mode to islanding mode; thus ensures overall smooth operation of the power network. Simulation results are presented to verify the effectiveness of the MAS based control system.