Digital controllers are involved in every aspect of today’s power systems, from local device-level to wide-area supervisory applications. However, the existing dynamic simulation tools are still struggling to capture an accurate response of such systems with adequate computational performance. The reason is that digital controllers introduce numerous discontinuities to the simulation and handling them is computationally expensive, thus forcing the users to compromise between accuracy and simulation performance. This paper investigates different traditional approaches for incorporating digital controllers in power system dynamic simulations and compares them with new interpolation-based approaches in terms of simplicity, accuracy, and performance.