With the growing electricity demand and environmental challenges, integration of the high penetration distribution generation (DG) into the utility grid is utmost important to improve the grid efficiency. Microgrid helps in facilitating the penetration of various DGs in the distribution network, while ensuring efficient, reliable and resilient operation in an islanded mode during a utility outage. However, the power electronic interface with DG units needs robust control techniques that can achieve high performance in all the loading conditions and conditions at the utility grid. Microgrid contains a cluster of loads along with DG units operating as a unified controlled system. Interconnecting DGs with a grid using power electronic converters has increase concerns regarding safe operation and protection of the equipment. Many control strategies have been proposed for enhancing the stability of microgrid for proper load sharing. However, these controllers have problems of slow dynamic response, disturbance to uncertainties and weak tracking of the references. Therefore, this work proposes new approaches using nonlinear control technique based on the sliding mode control (SMC) for an islanded mode as well as grid-connected mode of operation. Fixed Frequency Sliding Mode Voltage Control (FFSMVC) technique is developed for single and parallel voltage source inverter (VSI) in islanded mode, to maintain the quality of the output voltage of the DG system despite unbalanced and/or non-linear load currents. Fix frequency slide mode control is efficient in reducing the chattering phenomena, which otherwise call unnecessary harmonics and power loss in the system. Further, this controller improves the steady state and dynamic response under sudden load fluctuation. Droop control approach is investigated to guarantee the accurate power sharing among DG units in parallel operation. Fixed Frequency Sliding Mode Current Control (SMCC) approach is adopted for the grid-tied mode, where the controller works as a current controller. The proposed controller effectively abandons the grid voltage disturbances and the parameter uncertainties. Furthermore, PQ sharing control is designed for the parallel operating of DG units by delivering available power to the grid side in order to ensure power-sharing requirements. Both controllers have been simulated in the real-time domain of Simulink/MATLAB environment. Finally, the performance of the proposed FFSMC is compared with the classical proportional integral (PI) controller. The simulation results show the Total Harmonics Distortion (THD) of the output voltage of 0.86% and 1.54% for FFSMVC, and 1.82% and 6.84% for PI controller under linear and nonlinear loads respectively. The results also validate that the proposed control technique is quite effective due to its robust response and less sensitive to external disturbances.