In cascade AC systems, the impedance interaction between the source module and the load module may cause overall system instability. The generalized Nyquist stability criterion can be applied to characterize the stability of cascade three-phase AC systems. But it is usually very complicated and cannot directly reveal effective control strategy to alleviate the interaction problem. Based on three-phase voltage source PWM rectifier, this paper proposes a simplified stability criterion for three-phase AC systems. An input impedance regulator design method is introduced to alleviate the interaction problem. Finally, a 20 kW prototype is built and tested. The experimental results confirm the proposed stability criterion and the input impedance regulator design method.