Transient power demand fluctuations and maintaining high energy density are important for many portable devices. Small fuel cells are potentially good candidates as alternative energy sources for portable applications. Hybrid power sources have some inherent properties which may be effectively utilized to improve the efficiency and dynamic response of the system. In this paper, an improved dynamic model considering the characteristics of the temperature and equivalent internal resistance is presented for proton exchange membrane (PEM) fuel cells. The dynamic behavior of a system with hybrid PEM fuel cells and an ultracapacitor bank is simulated. The hybrid PEM fuel cell/ ultracapacitor bank system is used for powering a portable device (such as a laptop computer). The power requirement of a laptop computer varies significantly under different operation conditions. The analytical models of the hybrid system with PEM fuel cells and an ultracapacitor bank are designed and simulated by developing a detailed simulation software using Matlab, Simulink and SimPowerSystems Blockset for portable applications. (C) 2008 International Association for Hydrogen Energy. Published by Elsevier Ltd. All rights reserved.