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This paper presents an advanced model of the frequency response of a three-phase power transformer for use in conjunction with diagnostic measurements by the method of frequency response analysis (FRA). The model includes high- frequency behavior of the laminated core and the insulation through taking into account the frequency dependencies of the complex permittivity of insulation materials (paper, pressboard, and oil) and of the anisotropic complex permeability of magnetic core and conductors. A lumped parameter circuit model is used to simulate the frequency response of open-circuit impedance, short-circuit impedance, and impedance between primary and secondary windings, in which the characteristics of circuit elements are calculated by means of the finite-element method. The effect of correct representation of each circuit element on the FRA response is analyzed and discussed in comparison to measurement results on a real transformer.