When the conventional hybrid frequency (HF) modulation strategy applies to the asymmetric cascaded H-bridge (ACHB) inverter with dc voltage in a ratio of 1:1:2, there are uneven problems of switching loss in low-voltage cells and output power over all operating cells. Thus, a modified HF based on a dual-layer power balance (MHF-DPB) modulation strategy was presented. First, step modulation was still applied to a high-voltage cell on the basis of the conventional method, but improved level-shifted pulsewidth modulation (LS-PWM) was applied to two low-voltage cells. Subsequently, the power balance between high-voltage and low-voltage cells was controlled by adjusting the conduction angles of the power switch and then the carriers of the two low-voltage cells were rotated periodically in order to realize the two low-voltage cells’ power balance. The proposed method can not only realize the power balance of cascaded cells, but also distribute the switching loss of two low-voltage cells equally. In the meantime, it reduced the total switching loss of the inverter. Finally, it was validated by simulation and experimental results.