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Reliability of power-electronic modules is of paramount importance for the commercial success of various types of electric vehicles. In this paper, we study the technical feasibility of detecting and utilizing early symptoms and warning signs of power-module degradation due to thermomechanical stress and fatigue and develop a prognostic system that can monitor the state of health of the power modules in electric, hybrid, and fuel-cell vehicles. A special degradation trace on the VCEsat of the insulated-gate bipolar-transistor modules was observed by a power-cycling accelerated test, which was not reported in literatures. A prognostic system based on utilizing the aforementioned trace is then developed. The system consists of the hardware architecture and current adaptive-algorithm-based software architecture. In addition, this prognostic system hardly increases the hardware cost on existing vehicle-driver system. An extensive simulation based on MATLAB/Simulink verifies the developed prognostic system.