Using AC powerlines to create a communications network is not a new idea. Although the powerline is not an ideal environment for data communication but it has advantage of ubiquity: available in almost every place and denser than today's existing telephony networks and other dedicated data networks. The major applications in the powerline communication are: Automatic Meter Reading (AMR); Distribution Automation and Supervisory Control; Home-Bus for making the building "Intelligent"; Multimedia Communication- used as the last mile part communications. The goal of this report is to study the powerline communication (PLC) system, especially, used as in-home network for home automation and for supporting multimedia applications. Due to the characteristics of the powerline channel, the PLC system is different from the common wire network and makes high-speed data transmissions very challenging. This report points out some technical obstacles and presents some of the strategies to overcome them. We firstly study some aspects, such as the modulation (OFDM) in the physical layer and the Media Access Control (MAC) protocols, combining reliable data transmission with high-throughput access methods and real-time, Quality-of-Service (QoS) features. Some problems exist in TCP applications over PLC, because the high bit error rate makes it difficult to estimate the round trip time (RTT) and causes unnecessary retransmission. So we have done a feasible research on this program by means of network simulation technology. We propose a simulator which aims to find a TCP version to match the requirement of powerline communication system. In this simulator, a new error model is introduced, which takes into consideration both the frequency of the errors (error occurrences following a Poisson law) and their gravity (burst of errors or single errors). This model matches the real powerline environment better than other models. Simulation results show that TCPW makes a considerable throughput increment in comparison with TCP Reno and TCP SACK over PLC system.