High altitude platform stations (HAPS) are a new, promising means of providing International Mobile Telecommunications (IMT-2000). One of the potential problems of the system is the platform positional instability due to stratospheric winds. In this paper, we present a study of the effect of positional instability on the system level performance of a Universal Mobile Telecommunications System (UMTS) served by HAPS. Measurements of stratospheric winds at an altitude of 21 Km have been used to simulate the positional instability of a HAPS employing a propulsion station keeping mechanism. The platform instability model obtained gives input into a UMTS system level dynamic simulator and the effect of instability on the rate of soft handovers and system capacity is examined.