This paper presents nonlinear adaptive control scheme for improving the power quality in single-phase grid-connected photovoltaic (PV) systems. For this purpose, an LCL filter is used at the output-side of the voltage source inverter (VSI) in the single grid-connected PV system. In this paper, the proposed adaptive controller is designed for the VSI by considering the average model of the VSI while considering only the dynamics of the LCL filter. The proposed controller enhances the power quality of the system by maintaining the values of total harmonic distortions (THDs) at lower levels as it estimates the parameters of the LCL filter using adaptation laws. These adaption laws are obtained in such a way that it is not essential to know exact parameters of the LCL filter. The parameter estimation capabilities of the proposed scheme are ensured through the tracking performances of different state variables associated with the dynamics of the LCL filter. The convergences of tracking errors are ensured during the different stages of the controller design process using the Lyapunov stability analysis technique and the stability of the overall system is also analyzed in this paper. The improvements in the power quality, using the proposed nonlinear adaptive control scheme, are demonstrated on a 3.5 kW single-phase grid-connected PV system by considering different operating conditions. The results are mainly discussed in terms of THDs in the current injected into the grid and also compared with a sliding mode controller (SMC).