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A major disadvantage of diode clamped inverters (DCI) in practical implementations is capacitor dc voltage fluctuation. A new and very fast space vector modulation scheme for controlling the capacitor dc voltage fluctuation is introduced in this paper. The proposed algorithm accelerates the computation of the nearest three vectors and calculation of corresponding duty cycles without an increase in computational requirements when extended to DCIs with more levels. This new algorithm is appropriate for real time applications with DSP controllers used in industry. Performance of the proposed method has been simulated in MATLAB Simulink for both 3-level and 4-level three-phase DCIs, with experimental verification presented using a TMS320F2812 DSP. Experimental implementations demonstrate that the proposed method has the ability to effectively control dc-capacitor voltage in an N-level DCI where N is the number of levels (including zero volts) in one half cycle of the inverter line-to-line output voltage.