Several industrial operations in monitor control and command applications use data acquisition, where data from the external world is read, processed, used for decisions and, eventually, memorized by a digital system. Here data acquisition system with USB interface is considered. Using add-on serial to USB converters, an existing system can be made USB interfaced or the complete system can be redesigned using new generation microcontroller with inbuilt USB hardware stack. This paper describes a low-cost data acquisition system that includes Software-defined open source USB stack over generic ATmega32 microcontroller, having analog channels and digital I/O lines and a temperature sensor. At PC side, GUI application is designed using .NET with Instrumentation Active-x Controls to acquire and monitor data and control all system I/O. The system hardware developed is a low-cost alternative to commercially available systems that use USB controllers. The work has been implemented for temperature sensing and controlling and the results shown currently support the h/w and s/w developed. It can be used for biomedical analysis, industrial temperature loggers, industrial process, instrumentation controls and the like.