The construct of ‘control’ is virtually ubiquitous in psychology and it links to a comprehensive range of real-world outcomes. Control theory is critically important in this regard since it describes and models the dynamic systems that enable control to occur. Yet, the origins and principles of control theory in psychology are often misunderstood. This leads to a failure to capitalize on its strengths as a unifying, dynamic framework. We address this gap in knowledge by describing the early origins of control theory, and its two main paths of development within psychology, as a ‘man-machine system’ approach, and as a ‘grand theory’ of psychology. We introduce the grand theory approach to control theory, pioneered by William T. Powers (1926-2013). Powers stated that ‘behavior is the control of perception’ and he introduced a closed-loop, hierarchical architecture to implement this principle. We propose that Powers’ control theory provides a wholly new perspective on psychological science and is, as such, a ‘third grand theory’, after the behaviorist and cognitive theories. We describe a range of advances in neuroscience, animal behavior, social processes and mental health, based on Powers’ theory, to illustrate its potential to transform the nature of psychological research and practice.