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The near-state pulsewidth modulation (NSPWM) method, which reduces the common-mode voltage/current, is proposed for three-phase pulsewidth modulation (PWM) inverter drives. The method is described, its optimal voltage vectors are found, and the sequence that these vectors are applied is determined. Its voltage linearity and DC bus and AC output PWM current ripple characteristics are studied. Its output line-to-line voltage pattern is carefully studied with regard to switching transients that may cause overvoltages at the motor terminals, particularly for long-cable applications. The NSPWM method is thoroughly investigated, and its performance is compared to conventional PWM methods. Theory, simulations, and experiments show that NSPWM exhibits superior common-mode performance and satisfactory input/output PWM ripple performance characteristics. It is also illustrated that even though the method has bipolar line-to-line output voltage pulses, due to the sufficient zero-voltage time intervals for the switching transients to settle, these pulses do not cause additional overvoltages at the motor terminals compared to the conventional methods. The method is feasible for motor drives, particularly for operation in the high modulation index range, where its overall performance exceeds the performances of the state-of-the-art PWM methods.