A novel optimization algorithm is presented to improve the design of optimal controllers for load frequency control problem. This algorithm is applied for two area LFC system with using an output feedback controller. In the practical power system, access to some of the state variables in LFC system is limited and measuring is also impossible. So an optimal output feedback controller with a practical viewpoint is proposed. The optimal control law is determined by minimizing a performance index under the output feedback conditions leading to a coupled matrix equation. In order to solve these equations traditional methods may be used. But for more accuracy and better design for this controller, ICA algorithm is applied to find the global optimal gain matrix of the controller. Simulation results of ICA are compared with the conventional design. Comparison shows the success of ICA for design of optimal controller.