In this paper, a multilevel PWM inverter employing a cascaded transformer is presented to reduce the harmonics of output voltage and load currents. The proposed PWM inverter consists of two full-bridge modules and their corresponding transformers. The secondarics of each transformer are series-connected. So continuous output voltage levels can be synthesized from the suitable selection of the turns ratio of trasformer. And it appears an integral ratio to input DC source. Because of the cascaded connection of transformers, output filter inductor is not necessary. The operational principles and analysis are explained, and it is compared with a conventional isolated H-bridge PWM inverter. The validity of proposed multilevel inverter is verified through simulated and experimental waveform and their FFT results.