Multilevel inverters (MLI)s with reduced number of switching devices and DC sources have compact size, reduced cost and higher efficiency. This Project proposes a transformer based single-source MLI with reduced number of components and small size transformers. The proposed topology is a hybrid three-phase MLI assembled by a conventional three-phase two-level inverter (TTI) and two single-phase cascaded H-bridge inverters (CHBI)s. The proposed MLI has a low ratio of number of active switches to number of output voltage levels. In order to use only one DC source, the CHBIs are cascaded with the TTI through transformers. An individual nearest-level modulation (NLM) has been developed to voltage control of this inverter. Moreover power distribution between its modules is analysed. The total power of the transformers is 28% of the inverter rated power.