In this paper, a novel control strategy of curretn source PWM converter and inverter system for induction motor dirves is proposed. The PWM converter controls line current to be sinusoidal and makes input power factor unity. In the inverter part, a minor voltage control loop is incorporated in the current control looop in order to suppress unstale resonance between the filter capacitor and the motor leakage inductance and to keep the stator voltage under the rated value. In additon, the modulation index control of the inverter currents ripples and inverter loss. With the proposed algorithm, both high dynamic responses and satisfactory static performance can be obtained.